topic How do I include form 5329 when I e-file with TurboTax? in Retirement tax questions

How do I include form 5329 when I e-file with TurboTax?

dmurphy — Fri, 13 Mar 2020 18:19:02 GMT

I forgot to take an RMD from an inherited Roth in 2019. I withdraw it on Jan. 6, 2020. How do I include form 5329 to report that when I e-file with TurboTax?

Re: How do I include form 5329 when I e-file with TurboTax?

MinhT1 — Fri, 13 Mar 2020 20:41:06 GMT

Yes, you must include form 5329 when you e-file.

To fill out form 5329:

Open your return and click on Search on the top of your screen.
In the Search box, type form 5329 and click on the magnifying glass icon on the right
Click on the link Jump to form 5329
TurboTax will take you to a section where you can fill out form 5329, which will be included in your tax return.

Re: How do I include form 5329 when I e-file with TurboTax?

dmurphy — Fri, 13 Mar 2020 23:39:50 GMT

I tried that, but it's like it's doing a web search, not a search in TurboTax. It got 7742 hits. The first link is to this question online. I also clicked on "Forms", but that appears to only list the forms that are currently included in my return.

Re: How do I include form 5329 when I e-file with TurboTax?

AmyC — Sat, 14 Mar 2020 00:33:20 GMT

You don't have anything entered into your tax return to trigger the 5329. You have forms mode.

In forms mode, go to the top of the list and you will see OPEN form and ERRORS.
Click on open form.
Wait patiently, May need to click it again and wait
search box opens up
Type in 5329 pause,
the federal will dropdown and show 5329-T, Taxpayer an 5329-S for Spouse.
Click open form

@dmurphy

Re: How do I include form 5329 when I e-file with TurboTax?

dmurphy — Sat, 14 Mar 2020 17:38:03 GMT

Thank you, Amy. That worked great. I appreciate your help.

Re: How do I include form 5329 when I e-file with TurboTax?

ajbrogan — Sun, 21 Feb 2021 22:27:25 GMT

How do I add form 5329 in the online version of Turbo Tax? I tried the suggested search and had the same problem where I got a lot of irrelevant results. Is there a way to manually add a form in the online version? I've looked but can't find it. Thanks!

Re: How do I include form 5329 when I e-file with TurboTax?

ReneeM7122 — Mon, 22 Feb 2021 15:31:39 GMT

To access form 5329, you have to use Forms Mode. Please note, this could waive the 100% accuracy guarantee. You can use TurboTax Live and ask an expert for help, however, if you would like continue on your own, here is how to access form 5329:

If you are using the CD/download version:

Enter the forms mode and click on open form. Type in 5329. Choose 5329-T for the taxpayer (first person listed on your tax return), or 5329-S (for spouse - 2nd person on tax return).

Scroll down to Part IX line 52 and enter the RMD amount that should have been taken. On line 53 enter the amount of the RMD that was actually taken (probably zero if it was missed).

Then in the box right under line 53 "Waver of Tax Smart Worksheet" enter the same amount as line 52 (the RMD amount). Then click the "Explanation" button and enter the reason for missing the RMD and your statement requesting a waver.

You will not pay any penalty now until the IRS determines if it will grant the waver, then they will inform you if you owe the penalty.

OR - if using the Online version and have no 2019 1099-R to file, you will have to prepare the 5329 manually .

Download the 5329 form from the IRS website and fill it out the same as above. Print and mail your return with the 5329 form and explanation attached as described in the 5329 instructions.

The 2019 5329 must be attached to your printed and mailed 2019 tax return and cannot be e-filed.

Please note, if you have a COVID related need for the form, the IRS is updating form 5329’s instructions to make it clear that COVID related exceptions cannot use 5329 and should use the new 8915-E. TurboTax anticipates this form will be ready starting 2/25/2021.

Form 8915-E: Qualified 2020 Disaster Retirement Plan Distributions and Repayments

@ajbrogan

Re: How do I include form 5329 when I e-file with TurboTax?

Bob T1944 — Mon, 29 Mar 2021 02:36:15 GMT

Turbotax does not let me enter numbers in the data fields. I opened 2020 Traditional IRA by mistake. Since I am covered by employer retirement plan and my income exceeds the limit, I should not have opened the IRA. I closed the IRA and need to submit Form 5629 but I cannot enter data. How can I enter data? Thanks

Re: How do I include form 5329 when I e-file with TurboTax?

ajbrogan — Mon, 29 Mar 2021 03:37:16 GMT

Hi Bob -- are you using TurboTax online? I am too, and as you can see, I had a similar question above. I think this same problem happens to people all the time, so it would be great if TurboTax had an option to help us in the online version! I may have found a workaround, though, at least for a Roth IRA. To trigger the Form 5329 to appear, I created a dummy 1099-R with the dollar values I expect to see on my 1099-R next year. I had to work with my financial advisor to get the right numbers to enter on Lines 1 and 2a. I also had to Google the right codes to put into the 1099-R on line 7. I used 8 and J, and that seemed to work. Hope this helps! Good luck!

Re: How do I include form 5329 when I e-file with TurboTax?

Bob T1944 — Mon, 29 Mar 2021 03:57:37 GMT

Thanks. I'm working w the disc version. I've been trying to fiddle with other inputs to see if I can trigger getting Turbotax to ask me for the input data for the form (sorta like you did) but no luck yet. I've not experienced the situation before where I can't enter data directly to the form. Fortunately IRS and state extended the filing date. If I can't solve soon I am toying with trying HR Block Premium online and perhaps switching in in future years if their solution is better. Thanks

Re: How do I include form 5329 when I e-file with TurboTax?

ThomasM125 — Tue, 30 Mar 2021 21:12:30 GMT

@BobT1944 I suggest you enter the IRA contribution and work through the steps in TurboTax. You will be informed that you will be penalized for the excess IRA contribution and asked if you withdrew the money by the due date of your tax return. If you say "no" then form 5329 will be generated by TurboTax to account for the penalty on your excess contribution.

Re: How do I include form 5329 when I e-file with TurboTax?

Bob T1944 — Wed, 31 Mar 2021 01:16:19 GMT

Thanks. But I did withdraw the excess IRA contribution before my filing date and for this situation, Turbotax does NOT provide a Form 5329 for me to fill out. I put 7000 in and only got 6500 back because the value of the IRA went down. The banker will report the 500 loss for 2020 but will not send a 1099 until next year. So I'd like to report a 2020 loss. Don't I need to file a Form 5329 to do this? Thanks. BTW, Turbotax generated a Form 8606. Won't this cause me a problem if I don't include a 5329 to show I removed this excess contribution? Thanks again

Re: How do I include form 5329 when I e-file with TurboTax?

DawnC — Wed, 31 Mar 2021 02:19:03 GMT

No, you do not need Form 5329. You removed the excess contribution so you would only need to pay the 10% early withdrawal penalty on the earnings portion, but there was no earnings portion. Since you removed the excess contributions, no 6% penalty is incurred. The 6% penalty applies to the lesser of your excess contributions ($0) or the year-end balance

The loss that you had will carry forward within the account until you start to take distributions. @Bob T1944

Re: How do I include form 5329 when I e-file with TurboTax?

DaveF1006 — Fri, 23 Apr 2021 03:24:19 GMT

It depends. A 5329 is automatically generated in response to questions you answer in Turbo Tax. What is the specific reason why you need to file one?

Re: How do I include form 5329 when I e-file with TurboTax?

Anonymous — Wed, 26 Jan 2022 03:00:33 GMT

If it's anything like my situation, the Roth IRA custodian included the same amount in box 1 and 2a while also checking 2b. So I need to adjust the amount in 2a for the contributions to arrive at net income attributable, rather than the custodian's entry of the full box 1 amount. I'm not sure where else to do that within TurboTax other than 5329 or 8606 which are both not quite accessible directly

Re: How do I include form 5329 when I e-file with TurboTax?

ThomasM125 — Wed, 26 Jan 2022 04:51:14 GMT

@Anonymous

To report the earnings on your retirement distribution, you can make an entry for a substitute form 1099-R in addition to the normal entry, and put the earnings in box 1 and box 2(a). You will see an option to create a substitute form 1099-R on the screen that says Tell Us Which 1099-R You Have when you go to enter the form 1099-R. Code the substitute form 1099-R as "J" in box 7, for early distribution from a Roth IRA.

You will need to provide an explanation for the substitute form 1099-R explaining that the original form was not correct and the broker refused to amend it.

Re: How do I include form 5329 when I e-file with TurboTax?

fschmits405 — Tue, 01 Feb 2022 00:09:33 GMT

how do i include 5329 with return with turbo tax

Re: How do I include form 5329 when I e-file with TurboTax?

fschmits405 — Tue, 01 Feb 2022 00:11:33 GMT

can't find search o n return screen

Re: How do I include form 5329 when I e-file with TurboTax?

KrisD15 — Tue, 01 Feb 2022 00:36:10 GMT

You may click "Other Tax Situations" along the top of the screen

Scroll down to "Additional Tax Payments"

Scroll down to the section you need, I assume "Extra tax on early retirement withdraws" and click Start or Update.

If you enter an early withdraw from a retirement account, the program should generate a Form 5329.

Re: How do I include form 5329 when I e-file with TurboTax?

pcarlson9 — Sun, 06 Feb 2022 16:25:52 GMT

Slightly different question regarding form 5329.

In 2021 I found I had a $144 excess contribution to my Roth for my 2020 taxes. I removed it and the earnings ($13.17). I entered the 1099-R data as if I had received one ($157.17 in box 1, $13.17 in box 2a, codes JP in box 7 and indicated the 1099-R was for 2021. Everything matched when I actually got the form this Jan). TT created form 5329 for the excess and I paid tax on the earnings of $13 rounded down. (I'm over 59 1/2 so no penalty on the $27 withdrawal)

Thank you to all the helpful people on these forums for helping me with that process.

Now 2022 is here and I have another much smaller $27 excess contribution to my Roth for 2021 (I quit making contributions last Feb so this will be the last time I have to deal with this). I removed the $27 excess plus earnings of a whole whooping .38 cents! I entered the 1099-R info as if I'd received it just like last year.

But this time TT Did Not generate a form 5329.

Is this because the earning were only .38 which would be rounded down to zero? Therefore no taxable earning and a 5329 is not needed? I don't want to click file and find out 5239 was needed?

FYI The $27 was added to Form 1040-SR line 4a Ira Distributions, but was not included in the taxable amount on line 4b so I know the 1099-R info is in there.