If your Form 1099-R distribution was for any of the reasons listed below, it is generally exempt from additional penalties for an early withdrawal. If any of the exceptions apply, you may enter an exemption; go to:
- Federal Section
- Other Taxes
- Additional Taxes on Qualified Plans and Other Accounts, Reported on Form 5329
Enter the amount that is exempt in Part I – “Early Distributions that are not subject to 10% tax.” Select the reason from the drop-down menu.
| Reason with description provided from instructions for Form 5329 | |
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01 |
Separation from service after age 55: Qualified retirement plan distributions (doesn’t apply to IRAs) you receive after separation from service when the separation from service occurs in or after the year you reach age 55 (age 50 for qualified public safety employees). |
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02 |
Series of equal payments: Distributions made as part of a series of substantially equal periodic payments (made at least annually) for your life (or life expectancy) or the joint lives (or joint life expectancies) of you and your designated beneficiary (if from an employer plan, payments must begin after separation from service). |
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03 |
Total and permanent disability: Distributions due to total and permanent disability. You are considered disabled if you can furnish proof that you can’t do any substantial gainful activity because of your physical or mental condition. A medical determination that your condition can be expected to result in death or to be of long, continued, and indefinite duration must be made. |
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04 |
Death: Distributions due to death (does not apply to modified endowment contracts). |
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05 |
Medical Expenses: Qualified retirement plan distributions up to the amount you paid for unreimbursed medical expenses during the year minus 7.5% of your adjusted gross income (AGI) for the year. |
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06 |
Made to an alternate payee: Qualified retirement plan distributions made to an alternate payee under a qualified domestic relations order (doesn’t apply to IRAs). |
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07 |
Unemployed individuals for insurance: IRA distributions made to certain unemployed individuals for health insurance premiums. |
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08 |
Higher education purposes: IRA distributions made for qualified higher education expenses. |
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09 |
First home purchase: IRA distributions made for the purchase of a first home, up to $10,000. |
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10 |
Qualified retirement plan distributions made due to an IRS levy. |
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11 |
Reservists while serving on active duty: Qualified distributions to reservists while serving on active duty for at least 180 days. |
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12 |
Incorrectly Indicated as Early Distributions on Form 1099-R: Distributions incorrectly indicated as early distributions by code 1, J, or S in box 7 of Form 1099-R. Include on line 2 the amount you received when you were age 59 1/2 or older |
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13 |
From a Section 457 Plan, Which aren't from a Rollover: Distributions from a section 457 plan, which aren’t from a rollover from a qualified retirement plan. |
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14 |
Separated from Employer Maintained Plan by 3/1/1986 and Paid under Written Election: Distributions from a plan maintained by an employer if: 1. You separated from service by March 1, 1986; 2. As of March 1, 1986, your entire interest was in pay status under a written election that provides a specific schedule for the distribution of your entire interest; and 3. The distribution is actually being made under the written election |
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15 |
Dividends Paid with Respect to Stock Described in Section 404(k) |
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16 |
Annuity Contracts to the Extent that the Distribution are Allocable to the Investment: Distributions from annuity contracts to the extent that the distributions are allocable to the investment in the contract before August 14, 1982. For additional exceptions that apply to annuities, see Tax on Early Distributions under Special Additional Taxes in Pub. 575 |
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17 |
Phased Retirement Annuity Payments Made to Federal Employees: Distributions that are phased retirement annuity payments made to federal employees. See Pub. 721 for more information on the phased retirement program. |
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18 |
Permissible Withdrawals Under Section 414(w) |
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19 |
Qualified Birth or Adoption Distributions: Qualified birth or adoption distributions. Attach a statement that provides the name, age, and TIN of the child or eligible adoptee |
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Other. See Other explained in instructions, click here. |
Other: Click here to reference IRS Publication 575 to view other exceptions.