Lumpsum CPF distribution rollover to traditional IRA account

[WenHN]

How do I report this transaction on 1099-R form Box 7-  code 7  "Normal distribution" and/or code G "Direct rollover of a distribution..."?

[AmyC]

You will enter the 1099-R into the program and the program will ask you questions after entry. Follow these steps:

1. Open to the federal income section
2. Select 1099-R
3. Enter the 1099-R
4. Questions begin
5. Double check, IRA box is blank
6. Continue
7. Public Safety Officer, NO
8. Continue
9. Where is this from? usually None of the Above, but select the correct answer for you
10. Continue
11. Select From a qualified plan
12. What did you do?
13. Rolled it over
14. Continue
15. Periodic payments?
16. Select no
17. Continue
18. Withdrawal due to disaster?
19. Select NO
20. Continue

[WenHN]

Thank you for your reply.

CPF is the Singapore government retirement savings plan.  Hence, I'm currently at 1099-R section and not at where you've mentioned.

[RobertB4444]

When you get to the 1099-R section there is a box that says "I need to create a substitute 1099-R".  Tick that box.

Then enter all of the information as though you had received a 1099-R.  Since this is a rollover the entire amount goes in box 1 and box 2a should be zero.  Box 7 should be G.  The system will walk you through everything else.

Because you won't pay taxes on this transfer you aren't entitled to a foreign tax credit on it if you paid any taxes in Singapore.

@WenHN 

[WenHN]

Thank you.

Previously, a TT adviser said that I should fill out Boxes 2a, 5, and 6 because I know how much I contributed and how much was capital gains/appreciation.  Should I leave them blank now?

[AmyC]

Box 2a is the taxable amount. On a rollover, you would not need a taxable amount. Here are IRS examples and more.

Box 5 is the difference between the gross and the taxable amount. The amount being recovered this year, See here.

Box 6 unrealized appreciation. See the rules here

Personally, I would keep the information in my financial folder in case an issue arises later and would probably leave the boxes blank. I don't know all of your details, which is why I included links just to be safe.

Reference: Instructions for Forms 1099-R and 5498

[WenHN]

Thank you.

I thought Form 5498 will be completed and sent by my brokerage company that holds my newly opened IRA account, right?

TT software took me to fill out Form 4852 and not Form 5498 after I completed 1099-R.

[RobertB4444]

Form 5498 is completed by your brokerage company, not by you.

@WenHN 

[WenHN]

Sorry I'm still confused about what to do for Boxes 2a, 5, and 6 -- based on your answers, should I filled in those 3 boxes or leave them blank.

[BrittanyS]

Box 2a is for taxable income.  If the form is not filled in you can leave it blank.  See the links provided by AmyC above on boxes 5 & 6.  "Box 5 is the difference between the gross and the taxable amount. The amount being recovered this year, See here.  Box 6 unrealized appreciation. See the rules here"  If these do not apply and are blank on your form, you will leave them blank.

@WenHN 

[WenHN]

Thank you.

CPF didn't provide 1099-R or any detailed breakdown of the lumpsum distribution.  However, I've saved all my tax records and I know the amount I contributed and as such the total gain/appreciation.  Hence, since I know the amounts for those boxes, should I put them in?

The  wording for the links are uncleared to me if they meant for my CPF or only lumpsum distribution from US entities only.

Thank you for your clarification.

[DawnC]

The rules linked above are for any distribution of $10 or more from profit-sharing or retirement plans, any individual retirement arrangements (IRAs), annuities, pensions, insurance contracts, survivor income benefit plans, permanent and total disability payments under life insurance contracts, charitable gift annuities, etc.  The plan does not have to be from a US entity.  

If you know the amounts, you can include them.   Whether you do or you don't, be sure to keep detailed records.