Liquidating distribution on 1099

This article isn't intended to provide all the details on filing 1099s.

Rather, we want to make you aware of some frequently overlooked details.

The penalty is 10 percent of the taxable amount when you take an early distribution from an individual retirement account (IRA), a Roth IRA, a 401(k), a 403(b), or other qualified retirement plan before reaching age 59½.

liquidating distribution on 1099-66liquidating distribution on 1099-44

rodney alcala dating game transcript - Liquidating distribution on 1099

If the failure to file a return or to include the required information is due to intentional disregard of the rules, the above penalties don't apply.

Instead, the penalty is the greater of $250 per return or 10% of the amount required to be reported on 1099-MISC and certain other returns.

Exceptions for early distributions from IRAs include: You cannot have owned a home in the previous two years to qualify for the home-buying exclusion, and only $10,000 of the retirement distribution will avoid the tax penalty.

You don't have to itemize on your tax return to claim the medical expense exception.

You generally have until January 31 to prepare and mail 1099s to recipients.

You've generally got until February 28 to mail the required copy to the IRS.

There is a de minimis exception, but it's fairly narrow.

In addition, if you must file 250 or more information returns, you must file electronically.

If you find you need to file some 1099s and haven't, you can get forms at your local office supply store.

Many stores also have a software package that will make it easier to process the forms.

The additional tax increases to 25 percent if you take the distribution from a SIMPLE IRA within two years of the date you first began participating in the plan. The first applies to individual retirement accounts, both traditional and Roth IRAs.

Tags: , ,