Form 5329

The High Cost of IRA Mistakes

So you think you don’t need/can’t afford an advisor? Have you considered the cost of making IRA mistakes? Even seemingly simple transactions are subject to rules and restrictions under the tax code. Did you contribute too much by mistake? This mistake cannot be corrected by simply withdrawing the excess amount. There are rules on how to fix the mistake. If you are not thoroughly familiar with the IRA rules, it is all too easy to make a mistake, and mistakes can be very costly.

RMD Problems with Plan Rollovers to IRAs

You just hit the magical tax code age of 70 1/2 and decided it was time to move those employer plan retirement funds to an IRA. You must take your required minimum distribution from the plan first. What happens if you don't? IRA Technical Expert Beverly DeVeny outlines the consequences and how to correct them.

Slott Report Mailbag: How Do These Roth IRA 5-Year Rules Work?

The Slott Report Mailbag is full of inquiries on one of our most discussed topics, the Roth IRA 5-year rules, as well as a question that came from our Wednesday article on where you report your 2013 Roth IRA contributions on your tax return (hint: nowhere!). Click for this week's Q&A with our IRA Technical Expert.

Roth IRA 60-Day Rollover Rules

Many times we get the question “Do the 60-day rollover rules apply to Roth IRAs?” The answer is, yes. We explain why in detail below.

Disability Tax Code Benefits For Retirement Accounts

Whether it be from injury, illness or otherwise, being disabled can be physically trying and mentally challenging. It can also be tough on your wallet, as being disabled often carries with it additional medical costs, not to mention a possible loss of earning power. Certainly no one in their right mind would ever choose to be disabled, but if life has dealt you this hand, there are a few benefits available under the tax code to help you make the most of your retirement accounts. Below are three such benefits, discussed in greater detail.

Slott Report Mailbag: I Just Inherited an IRA or Roth IRA From My Spouse. What Do I Do Now?

This week's Slott Report Mailbag answers what we call some of the "nuts and bolts" of IRA planning. We received questions on required minimum distributions (RMDs) and inherited IRAs - two of our most popular topics, and also two of the topics where we see the most mistakes and disaster stories. Away we go with another Thursday mailbag!

One IRA Rollover Per Year Per IRA Account

Many IRA owners do not realize that they can only do one IRA-to-IRA or Roth-to-Roth rollover, per IRA or Roth IRA account, per year. If you have more than one IRA or Roth account, you can do one rollover from each account. So you could do five rollovers when you have five IRAs. If you do a rollover on April 20th, you cannot do another rollover from that account until the next April 20th.

Year-End RMD Reminders

Time is running out to take required minimum distributions (RMDs) due for this year. Many companies have cut-off dates for distributions, so if you have not yet taken your RMD you need to act now. The penalty for not taking a distribution is 50% of the amount not taken. It must be reported on Form 5329 and if it is not reported, the statute of limitations does not start to run. Following are answers to questions that come up frequently at this time of year.

Form 5329: Additional Taxes on Qualified Plans and Other Tax-Favored Accounts

What is Form 5329? Its title is "Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts." You should file the form whenever you miss a required distribution, take a distribution before age 59 ½ when one of the penalty exceptions does not apply, and when you make excess contributions. Those are most of the reasons to file the form. The form calculates any additional taxes owed (what are often called penalties) for certain IRA transactions. Not filing the form could only make things much, much worse.

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Please contact Matt Smith at [email protected] or (516) 536-8282 with any questions.