Level 3

Form 5329 Not Calculating a Penalty

Forum|Forum|7 years ago
March 21, 2019
1 reply
7 views

Client took early distributions from traditional IRA from various sources. Some were rolled over within 60 days, others were not. On 1099-R Worksheet, I checked box B1 for those that were rolled over and left it blank for those that were not. No penalty is being calculated on the early distributions not rolled over. What have I done wrong?

ProSeries Professional

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IntuitCharlene

Community Manager

The 5329 would only show a penalty for any taxable transactions. If there is Basis on the IRA Information Worksheet that is greater then the distribution the 8606 line 15 will show the taxable portion. Only the taxable portion from line 15 flows to the 5329 for the 10% additional tax.

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Accept as solution" and then just changing the Accept as solution to Mark as Best Answer, mine gets cutoff, so it is too long. I changed mine to the following and it fits. -->**Say "Thanks" by clicking the thumb icon in a post**Click "Mark as Best Answer " to mark the post that answers your question.

A

AliAuthor

Level 3

Thank you. That's it! I forgot they had basis in the IRA.

IntuitCharlene

Community Manager

I'm glad we were able to find what was making it non-taxable! It's often easy to forget about the Basis being on a different worksheet. Have a great day and thanks for stopping by our AMA Session!

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Accept as solution" and then just changing the Accept as solution to Mark as Best Answer, mine gets cutoff, so it is too long. I changed mine to the following and it fits. -->**Say "Thanks" by clicking the thumb icon in a post**Click "Mark as Best Answer " to mark the post that answers your question.

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