If you made a premature withdrawal from an IRA, the 5329 will populate automatically. First of all, make sure the IRA/SIMPLE/SEP box is checked in your 1099-R so that the questions will appear.
- Assuming you have entered your 1099-R for your IRA and you checked the IRA/SIMPLE/SEP box.
- Also the distribution code in Box 7 must indicate this is Code 1, no known exception. This will trigger a screen later in the interview that says Let's lower your tax Bill
- Next screen will say Did you use your IRA to pay for any of these expenses? Here you will enter an amount under First home purchase (up to $10,000)
- Next screen says Good News: Your Tax Bill Just Got Lower
- Now you can verify that a Form 5329 is in your return by going to tax tools>tools>delete a form. Check your forms and form 5329 should be there. It was for me and should be for you.
- Note a 5329 will not appear unless the IRA box is checked and if any other code other than code 1 is listed in Box 7 in your 1099R.
- Also if Code 2 is listed in Box 7, a 5329 will generate also but will not give you an option to put in your first time homebuyer information.
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