2007 Form 1099-R Instructions
Generally, distributions from pensions, annuities, profit-sharing and retirement plans, IRAs, insurance contracts, etc., are reported to recipients on Form 1099-R.
Qualified plans. If your annuity starting date is after 1997, you must use the simplified method to figure your taxable amount if your payer did not show the taxable amount in box 2a. See Pub. 575, Pension and Annuity Income.
IRAs. For distributions from a traditional individual retirement arrangement (IRA), simplified employee pension (SEP), or savings incentive match plan for employees (SIMPLE), generally the payer is not required to compute the taxable amount. Therefore, the amounts in boxes 1 and 2a will be the same most of the time. See the Form 1040 or 1040A instructions to determine the taxable amount. If you are at least age 70 1/2 , you must take minimum distributions from your IRA (other than a Roth IRA). If you do not, you may be subject to a 50% excise tax on the amount that should have been distributed. See Pub. 590, Individual Retirement Arrangements (IRAs), and Pub. 560, Retirement Plans for Small Business (SEP, SIMPLE, and Keogh Plans), for more information on IRAs.
Roth IRAs. For distributions from a Roth IRA, generally the payer is not required to compute the taxable amount. You must compute any taxable amount on Form 8606, Nondeductible IRAs. An amount shown in box 2a may be taxable earnings on an excess contribution.
Coverdell eduation savings accounts (ESAs). For distributions from a Coverdell ESA, you must compute any taxable amount. See your tax return instructions for reporting information.
Loans treated as distributions. If you borrow money from a qualified plan, tax-sheltered annuity, or government plan, you may have to treat the loan as a distribution and include all or part of the amount borrowed in your income. There are exceptions to this rule. If your loan is taxable, Code L will be shown in box 7. See Pub. 575.
Box 1. Shows the total amount you received this year. The amount may have been a direct rollover, a transfer or conversion to a Roth IRA, a recharacterized IRA contribution; or you may have received it as periodic payments, as nonperiodic payments, or as a total distribution. Report this amount on Form 1040 or 1040A on the line for “Total IRA distributions” or “Total pensions and annuities” (or the line for “Taxable amount”), and on Form 8606, whichever applies, unless this is a lump-sum distribution and you are using Form 4972, Tax on Lump-Sum Distributions. However, if you have not reached minimum retirement age, report your disability payments on the line for "Wages, salaries, tips, etc." Also report on that line corrective distributions of excess deferrals, excess contributions, or excess aggregate contributions.
If a life insurance, annuity, or endowment contract was transferred tax free to another trustee or contract issuer, an amount will be shown in this box and Code 6 will be shown in box 7. You need not report this on your tax return.
Box 2a. This part of the distribution is generally taxable. If there is no entry in this box, the payer may not have all the facts needed to figure the taxable amount. In that case, the first box in box 2b should be marked. You may want to get one of the following publications from the IRS to help you figure the taxable amount: Pub. 560, Pub. 571, Tax-Sheltered Annuity Programs for Employees of Public Schools and Certain Tax-Exempt Organizations, Pub. 575, Pub. 590, Pub. 721, Tax Guide to U.S. Civil Service Retirement Benefits, or Pub. 939, General Rule for Pensions and Annuities. For an IRA distribution, see IRAs and Roth and education IRAs above. For a direct rollover, zero should be shown, and you must enter zero (-0-) on the “Taxable amount” line of your tax return.
If this is a total distribution from a qualified plan and you were born before 1936 (or you are the beneficiary of someone born before 1936), you may be eligible for the 10-year tax option. See the Instructions for Form 4972 for more information. The 10-year tax option does not apply to any IRA or to tax-sheltered annuities.
Box 2b. If the first checkbox is marked, the payer was unable to determine the taxable amount, and box 2a should be blank unless this is a traditional IRA, SEP, or SIMPLE distribution. If the second checkbox is marked, the distribution was a total distribution that closed out your account.
Box 3. If you received a lump-sum distribution from a qualified plan and you were born before 1936 (or you are the beneficiary of someone born before 1936), you may be able to elect to treat this amount as a capital gain on Form 4972 (not on Sch. D (Form 1040)). See the Instructions for Form 4972. For a charitable gift annuity, report as a long-term capital gain on Schedule D (Form 1040).
Box 4. This is the amount of Federal income tax withheld. Include this on your income tax return as tax withheld, and if box 4 shows an amount other than zero, attach Copy B to your return. Generally, if you will receive payments next year that are not eligible rollover distributions, you can change your withholding or elect not to have income tax withheld by giving the payer Form W-4P, Withholding Certificate for Pension or Annuity Payments.
Box 5. Generally, this shows the employee’s investment in the contract (after-tax contributions), if any, recovered tax free this year; the part of premiums paid on commercial annuities or insurance contracts recovered tax free; or the nontaxable part of a charitable gift annuity. This box does not show any IRA contributions.
Box 6. If you received an annuity contract as part of a distribution, the value of the contract is shown. It is not taxable when you receive it and should not be included in boxes 1 and 2a. When you receive Box 6. If you received a lump-sum distribution from a qualified plan that includes securities of the employer’s company, the net unrealized appreciation (NUA) (any increase in value of such securities while in the trust) is taxed only when you sell the securities unless you choose to include it in your gross income this year. See Pub. 575 and the Instructions for Form 4972. If you did not receive a lump-sum distribution, the amount shown is the NUA attributable to employee contributions, which is not taxed until you sell the securities.
Box 7. These codes identify the distribution you received:
If the IRA/SEP/SIMPLE box is marked, you have received a traditional IRA, SEP, or SIMPLE distribution.
Box 8. If you received an annuity contract as part of a distribution, the value of the contract is shown. It is not taxable when you receive it and should not be included in boxes 1 and 2a. When you receive periodic payments from the annuity contract, they are taxable at that time. If the distribution is made to more than one person, the percentage of the annuity contract distributed to you is also shown. You will need this information if you use the special 10-year tax option (Form 4972).
Box 9a. If a total distribution was made to more than one person, the percentage you received is shown.
Box 9b. For a life annuity from a qualified plan or from a tax-sheltered annuity (with after-tax contributions), an amount may be shown for the employee’s total investment in the contract. It is used to compute the taxable part of the distribution. See Pub. 575.
Box 10-15. If state or local income tax was withheld from the distribution, these boxes may be completed. Boxes 12 and 15 may show the part of the distribution subject to state and/or local tax.