topic Does form 8880 replace form 5329? for a 1099-R? We have a... in Retirement tax questions

Distributions from retirement plans. Paid penalties in 2017. The penalties were more than distributions were. But, it makes our taxes higher now even though its paid for?

scythia23 — Sat, 01 Jun 2019 19:33:00 GMT

Had a 401k with a previous employer. Switched jobs and did not switch 401k to new employer. Old 401k auto closed and distributed in 2016. had to pay penalties in 2017 but I have a new 401k which I make contributions to with employment check. Since the penalties are paid do I need to input my 1099-R from 2017? (did not receive a 1099-R for 2018)

Did you receive any of this money in 2018?

Vanessa — Sat, 01 Jun 2019 19:33:02 GMT

Did you receive any of this money in 2018?

No we did not. The closed 401k account distributed every...

holyangel98 — Sat, 01 Jun 2019 19:33:03 GMT

No we did not. The closed 401k account distributed everything it had in 2016. and again we paid penalties in 2017

Where do you see penalties for 2018? Is there a 5329 fo...

macuser_22 — Sat, 01 Jun 2019 19:33:05 GMT

Where do you see penalties for 2018? Is there a 5329 form - if so what line is the penalty on?

No, we do not have 5329 as far as our records go. H&R fil...

holyangel98 — Sat, 01 Jun 2019 19:33:06 GMT

No, we do not have 5329 as far as our records go. H&R filled a 8880

If you didn't receive any of the money in 2018, you will...

Vanessa — Sat, 01 Jun 2019 19:33:09 GMT

If you didn't receive any of the money in 2018, you will not report it on your 2018 return.

If you did not report this income on your 2017 return you will need to Amend Your Return for 2017. Income is reported in the year it is received. If you did include it on your 2017 return, then you do not need to do anything at all with it.

Does form 8880 replace form 5329? for a 1099-R? We have a...

holyangel98 — Sat, 01 Jun 2019 19:33:10 GMT

Does form 8880 replace form 5329? for a 1099-R? We have a Form 8880. If so, yes we did.

No. 8880 is a credit for retirement savings. The 53...

macuser_22 — Sat, 01 Jun 2019 19:33:12 GMT

No. 8880 is a credit for retirement savings. The 5329 is penalties. Your question refers to 2017 penalties and you said it is making your 2018 taxes higher - what are you seeing that is doing that?

Distributions from retirement plans. then it asks about t...

scythia23 — Sat, 01 Jun 2019 19:33:13 GMT

Distributions from retirement plans. then it asks about the following years.
2015-2016 = no
2017 = yes (which makes our tax go up, but its paid for.)
2018 = no
2019 = no
ABLE account distributions = no

That is just to calculate the amount of savers credit yo...

macuser_22 — Sat, 01 Jun 2019 19:33:14 GMT

That is just to calculate the amount of savers credit you qualify for. It is not making the tax higher, it is reducing the amount of the credit that lowers the tax. When you enter the distribution then there is less credit to reduce the tax.

Past years distributions will reduce the credit. See the 8880 form instructions:
<a rel="nofollow" target="_blank" href="https://www.irs.gov/pub/irs-pdf/f8880.pdf">https://www.irs.gov/pub/irs-pdf/f8880.pdf</a>