Form 5329

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Use Form 5329 to report additional taxes on: Individual retirement arrangements (IRAs), Other qualified retirement plans, Modified endowment contracts, Coverdell ESAs, Qualified tuition programs (QTPs), Archer Medical Savings Accounts (MSAs), or Health savings accounts (HSAs).

You must file Form 5329 if any of the following apply, except you do not have to file Form 5329 to report a qualified hurricane distribution.

Note: You do not have to file Form 5329 if distribution code 1 is correctly shown in box 7 of all Forms 1099-R and you owe the additional tax on each Form 1099-R. Instead, see the instructions for Form 1040, line 60, for how to report the additional 10% tax directly on that line.

• You received an early distribution from a Roth IRA, the amount on Form 8606, line 23, is more than zero, and you are required to enter an amount that is more than zero on Form 5329, line 1 (see Exception for Roth IRA Distributions on page 2).
• You received an early distribution from a qualified retirement plan (other than a Roth IRA) and distribution code 1 is not shown in box 7 of Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.
• You meet an exception to the tax on early distributions and distribution code 1 is shown in box 7 of Form 1099-R.
• You meet an exception to the tax on early distributions from the list that begins on page 2 but box 7 of your Form 1099-R does not indicate an exception or the exception does not apply to the entire distribution.
• You received taxable distributions from Coverdell ESAs or QTPs.
• The contributions for 2005 to your traditional IRAs, Roth IRAs, Coverdell ESAs, Archer MSAs, or HSAs exceed your maximum contribution limit, or you had a tax due from an excess contribution on line 17, 25, 33, 41, or 43 of your 2004 Form 5329.
• You did not receive the minimum required distribution from your qualified retirement plan.

Early withdrawal Penalty

A quick review of the exceptions to the early withdrawal penalty before age 59 1/2.

Form 5329 Code #	Exception applies to	Exeption
01	Qualified Plans	Distribution made to an employee who has attained age 55 and separated from service.
02	Qualified Plans & IRAs	Distribution is part of a scheduled series of substantially equal periodic payments (SEPPS) made over the life expectancy of the participant and the beneficiary.
03	Qualified Plans & IRAs	Distribution made due to disability.
04	Qualified Plans & IRAs	Distribution made after death of the employee.
05	Qualified Plans & IRAs	Distribution used to pay medical expenses to the extent such expenses exceed 7.5% of adjusted gross income.
06	Qualified Plans	Distributions made to an alternate payee pursuant to a qualified domestic relations order
07	IRAs	Distributions to pay for health insurance premiums for certain unemployed individuals.
08	IRAs	Distributions to pay for qualified higher education expenses of the taxpayer, spouse, child, or grandchild.
09	IRAs	Distributions for first-time home purchases (no home ownership in prior two years). Distribution limited to $10,000 (lifetime maximum).
10	Qualified Plans & IRAs	Distributions due to an IRS levy on the plan or IRA. The exception will not apply if funds are withdrawn to avoid a levy