Form 5498 Does Not Apply to Solo 401k Plans

Form 5498 does not apply to qualified plans including solo 401k plans. This form only applies to IRAs.

See:https://www.irs.gov/pub/irs-pdf/f5498.pdf

https://www.irs.gov/pub/irs-pdf/i1099r.pdf

Unfortunately, financial institutions that process IRA distributions as 60-day rollovers instead of processing the movement of funds as a “direct-rollover” to a solo 401k plan or full-time employer 401k plan will incorrectly inform the account holder that the 401k provider will issue a 5498 for the solo 401k or 401k to report the 60-day rollover, which is not correct since Form 5498 only applies to IRAs.

On a side note, the Form 5498 for the prior year is typically due by the end of May.  However, this year (2020), the deadline has been moved to July 15, 2020 due to coronavirus (COVID-19) pandemic.  This extension is outlined in IRS Notice 2020-23.

Breakdown of 2019 Form 5498

Box 1, IRA Contributions (other than amounts in boxes 2–4, 8–10, 13a, and 14a)Enter Traditional IRA contributions made January 1, 2019, through July 15, 2020*, for 2019. Do not include SEP, SIMPLE IRA, or Roth IRA contributions. Do not include rollovers, recharacterizations, or Roth IRA conversions.

Box 2, Rollover contributionsEnter any rollover contributions received in 2019. The following transactions are considered rollovers.

  • Eligible rollovers between IRAs of the same type

  • Direct or indirect rollovers from qualified retirement plans, governmental 457(b) plans, 403(b) plans, and the federal Thrift Savings Plan to Traditional or Roth IRAs

  • Military death gratuities and Servicemembers’ Group Life Insurance contributions to Roth IRAs

Do not include late rollover contributions.

Box 3, Roth IRA conversion amountEnter amounts converted from a Traditional IRA (including those holding SEP contributions) or SIMPLE IRA to a Roth IRA during 2019. Do not include rollovers between two Roth IRAs or from an employer-sponsored retirement plan to a Roth IRA. Include such rollovers in Box 2.

Box 4, Recharacterized contributionsEnter amounts recharacterized in 2019, including earnings, from one type of IRA to another.

Box 5, FMV of account—Enter the fair market value of the account as of December 31, 2019.

Box 6, Life insurance cost included in box 1 Enter the amount included in Box 1 that is allocable to the cost of life insurance. This box is for endowment contracts only; it will not be completed for IRAs because life insurance is not a permitted IRA investment.

Box 7, IRA, SEP, SIMPLE, and Roth IRA check boxesCheck the appropriate box to indicate the IRA type. Check the “IRA” checkbox for a Traditional IRA.

Box 8, SEP contributionsEnter all SEP contributions made to a Traditional IRA in 2019, including contributions made in 2019 for 2018. Do not include contributions made in 2020 for 2019. Do not report regular Traditional IRA contributions in this box, even if the IRA holds SEP plan contributions.

Box 9, SIMPLE contributionsEnter all SIMPLE IRA contributions made in 2019, including contributions made in 2019 for 2018. Do not include contributions made in 2020 for 2019. Do not enter SIMPLE 401(k) plan contributions in this box.

Box 10, Roth IRA contributionsEnter Roth IRA contributions made January 1, 2019, through July 15, 2020*, for 2019.

Box 11, Check if RMD for 2020The Coronavirus Aid, Relief, and Economic Security (CARES) Act waived 2020 RMDs so no RMD is due for 2020. For other tax years, this box is to be checked if an IRA owner must take an RMD for the current year.

Box 12a, RMD dateThe CARES Act waived 2020 RMDs so no RMD is due for 2020. For other tax years, if using Form 5498 to satisfy the January RMD statements for IRA owners, the deadline for taking a 2020 RMD should be shown here.

Box 12b, RMD amountThe CARES Act waived 2020 RMDs so no RMD is due for 2020. For other tax years, enter the RMD amount due if using Form 5498 to satisfy the January RMD statement requirement for IRA owners.

Box 13a, Postponed/late contrib.Enter the amount of any postponed contributions made in 2019 for a prior year. This includes a rollover contribution that is more than 60 days after distribution.

Box 13b, YearEnter the year for which the postponed contribution in Box 13a was made. Leave blank for late rollover contributions and rollovers of qualified plan loan offset amounts.

Box 13c, CodeEnter the reason code (described in the form instructions) for the postponed contribution in Box 13a.

Box 14a, RepaymentsEnter the amount of any repayments of a qualified reservist distribution, a qualified disaster distribution, or a qualified birth or adoption distribution.

Box 14b, CodeEnter “QR” for qualified reservist distribution repayments, “DD” for qualified disaster distribution repayments, or “BA” for qualified birth or adoption distribution repayments.

Box 15a, FMV of certain specified assetsEnter the FMV for specific investments in the IRA that are hard-to-value assets or do not have readily available FMVs as specified in the instructions for Box 15b codes (e.g., real estate, and certain short or long-term debt obligations, stocks, or ownership interests that are not traded on established securities markets or option exchanges, etc.).

Box 15b, Code(s)Enter the applicable code(s) (described in the form instructions) for the type(s) of investments for which the FMV is reported in Box 15a. A maximum of two codes can be entered. If more than two apply, enter code H.

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