So, my husband and I are definitely under 70 1/2 years old and therefore do not have to take Required Minimum Distributions. With our life insurance policy comes a rider for a qualified long term care contract. We get a 1099-R every year showing what is allocable to the contract. Box 1 has an amount and Box 8 has the same amount and then there is a code W in Box 7. There are no other codes and nothing else is checked off. This year for 2020 I went into TT and as I was completing the taxes, I put all the entries in the step by step instructions, as I have done in the past many times and this time a form 5329 popped up with a code 12 in it. This has never happened before, so I inspected my previous years entries against what I did this year with the 1099-R and they were all the same. I deleted out the 1099-R's and the 5329's and tried again and just as I would create the 1099-R, again the form 5329 popped up. So, again I deleted out the 1099-R and the 5329 again. The only thing in the 5329 was the amount in the 1099-R and the code 12 in it. Well, I wasn't giving up. I would rather report all information returns, because the IRS has that information. So, I went into the forms and I called up a form 1099-R instead of using the step by step instructions. I typed in the form I needed, 1099-R and opened up a new form and I put everything in the form itself. Where the Code W came up the W came up with two lines of words for one sentence, so I pressed on the second line of wording, (don't know if that did the trick or not), but it was all one sentence. It is just that on my computer it rolled into two lines. I entered everything in. I entered the amount in box 1 and box 8 and a zero for box 2a. I put the state and state ID in made sure to go over the EIN number for the payer, the name, the address and made sure the normal 1099-R box was checked off at the top. I made sure my own info populated as the recipient. I was very careful and looked constantly after every step I took to see if the form 5329 would pop up. Well it did not. No form 5329 popped up. I agree with Jason that when I look at the back of the 1099-R form for instructions regarding long term care contract charges, you do not have to enter the 1099-R form in your taxes, but I always have. The reason is you can call the IRS and you really can get 10 different answers from 10 different people who work from the IRS as they all have their own interpretations. Regardless, this is what I did. Better to be safe than sorry. However, Jason is right, it does say right on the 1099-R you do not have to enter the 1099-R form. But, if you are like me. Well go ahead and try what I did. Don't go through the steps, use the form itself. Delete out the 1099-R and the 5329 and manually enter it into the form.
