Tax Forms for Retirement Accounts: 1099-R, 5498, 8606, 5329

The tax forms for retirement accounts come down to four workhorses, with a fifth that only shows up when something went wrong. Form 1099-R reports anything that came out of an account. Form 5498 reports what you put into an IRA. Form W-2 handles workplace plan deferrals through Box 12. Form 8606 tracks after-tax money inside a traditional IRA. Form 5329 appears only if you owe a penalty: early withdrawal, excess contribution, or missed required distribution. Which forms you actually need depends on what happened in your account during the year.

Form 1099-R: Anything That Came Out

Any time money leaves a retirement account, the custodian reports it on Form 1099-R. That covers traditional and Roth IRAs, 401(k)s, 403(b)s, pensions, annuities, and profit-sharing plans. You should have it by January 31 of the year after the distribution.¹

Box 1 shows the gross distribution. Box 2a shows the taxable portion. If Box 2a says “Taxable amount not determined,” you’re on the hook for calculating how much is actually taxable, usually with Form 8606. Box 4 shows federal income tax your custodian already withheld, which flows to the payments section of Form 1040.

Box 7 Distribution Codes

The most important field on the form is the Box 7 distribution code. It tells the IRS why money left your account, which determines whether you owe a penalty, ordinary income tax, both, or neither.

Code 1: early distribution before age 59½ with no known exception. Flags the 10% early withdrawal penalty on top of regular income tax.
Code 2: early distribution with an exception the custodian knows about, so no 10% penalty. Also used for Roth conversions when the account holder is under 59½.²
Code 4: distribution to a beneficiary after the account holder’s death. No early withdrawal penalty regardless of the beneficiary’s age.²
Code 7: normal distribution at or after 59½. Fully taxable for traditional accounts, no penalty.
Code G: direct rollover from one qualified plan to another, such as a 401(k) to an IRA. Not taxable, not penalized.
Code J: early Roth IRA distribution with no known exception. The earnings portion may still be taxable and penalized if the five-year holding period hasn’t been met.²

Where It Goes on Form 1040

IRA distributions go on Line 4a (total) and Line 4b (taxable portion). Pensions and annuities use Lines 5a and 5b.³ For a straightforward rollover, enter the gross distribution on Line 4a, put zero on Line 4b, and write “Rollover” next to the line.

A Roth conversion shows up on 1099-R with Code 2 if you’re under 59½ or Code 7 if you’re older. The converted amount in Box 1 is generally fully taxable as ordinary income in the year of the conversion. If any of your traditional IRAs hold nondeductible contributions, part of the conversion is tax-free, but you need Form 8606 to calculate the split.

Form 5498: What You Put Into an IRA

Your IRA custodian files Form 5498 to report every contribution, rollover, and the year-end value of the account. Because you can make IRA contributions for the prior tax year all the way up to the April filing deadline, the custodian doesn’t have to send the form until May 31. You won’t use it to fill out your tax return directly, but it confirms your contributions and helps the IRS verify the limits.⁴

For 2026, the annual IRA contribution limit is $7,500. At 50 or older you can add $1,100 in catch-up contributions, for a total of $8,600.⁵

The boxes worth knowing:

Box 1: traditional IRA contributions. If you qualify for a deduction, you claim it on Schedule 1. Active participants in an employer plan may see the deduction phased out based on income.
Box 5: fair market value of the account as of December 31. This number drives next year’s RMD calculation once you reach RMD age.
Box 10: Roth IRA contributions. Not deductible, but tracked against the annual limit.⁴

Boxes 3, 4, 8, and 9 cover Roth conversions in, recharacterizations, and employer SEP or SIMPLE contributions. If you did any of those, confirm the amounts match your own records.

Form W-2 Box 12: Workplace Plan Deferrals

If you contribute to a 401(k), 403(b), or governmental 457(b) through work, those contributions don’t get a separate form. They appear in Box 12 of the W-2 you already receive in January, using letter codes to identify each type.⁶

For 2026, employees can defer up to $24,500 into a 401(k), 403(b), or governmental 457(b). The catch-up contribution is $8,000 at age 50 or older, with a special higher catch-up of $11,250 if you’re between 60 and 63.⁵

The common Box 12 codes:

Code D: elective deferrals to a 401(k), including SIMPLE 401(k)s.
Code E: elective deferrals to a 403(b) salary reduction agreement.
Code AA: designated Roth contributions to a 401(k).⁶

Pre-tax deferrals (D, E) are subtracted from wages before your employer calculates Box 1, which is the amount subject to federal income tax. You don’t claim a separate deduction on your 1040; the break is already in your reported wages. Those same deferrals are still included in Box 3 (Social Security wages) and Box 5 (Medicare wages), because payroll taxes apply to the full amount.⁷

Roth contributions (Code AA) work the opposite way. The money stays in Box 1 wages because you’re paying tax now in exchange for tax-free qualified withdrawals later.

Form 8606: Nondeductible IRA Basis

Form 8606 is easy to overlook, and that’s exactly why it causes problems. If you make nondeductible contributions to a traditional IRA, this form is how the IRS knows you already paid tax on that money. Without it, you can end up paying tax twice: once when you contributed and again when you withdraw.⁸

File Form 8606 in any year you make a nondeductible traditional IRA contribution, take a distribution from a traditional IRA with any nondeductible basis on record, convert traditional IRA funds to a Roth, or take a distribution from a Roth IRA. Skipping it when required carries a $50 penalty per occurrence, and you lose the paper trail that proves part of your account was already taxed.⁹

The Pro-Rata Rule and the Backdoor Roth

Form 8606 becomes critical if you use the backdoor Roth strategy, which means making a nondeductible traditional IRA contribution and then converting it. The IRS applies a pro-rata rule: it treats all your traditional, SEP, and SIMPLE IRA balances as one pool when calculating how much of a conversion is taxable. You cannot cherry-pick just the nondeductible dollars.

If you have $94,000 of pre-tax funds across all your traditional IRAs and you make a $6,000 nondeductible contribution, your total IRA balance is $100,000 and only 6% represents after-tax money. Converting that $6,000 to a Roth is not a tax-free conversion. Instead, 94% of the converted amount is taxable. Form 8606 walks through this calculation line by line, and the result flows to Form 1040.

Form 5329: When Something Went Wrong

Form 5329 is the form nobody wants to file, because it means you withdrew too early, contributed too much, or missed a required distribution. It calculates the additional tax and sends the result to Schedule 2 of Form 1040.¹⁰

Early Withdrawal Penalty

Distributions before age 59½ generally face a 10% additional tax on top of ordinary income tax. If your 1099-R shows Code 1 in Box 7, the IRS expects you to either pay the penalty or prove an exception applies. You report the distribution on Form 5329, subtract any portion that qualifies for an exception, and apply 10% to the remainder.¹¹ Common exceptions include unreimbursed medical expenses above a threshold, up to $10,000 lifetime from an IRA for a first-time home purchase, and qualified higher education costs.¹²

Excess Contributions

Contribute more than the annual IRA limit and a 6% excise tax applies to the excess for every year it remains in the account.¹³ You report it on Form 5329, and the penalty keeps compounding until you withdraw the excess or absorb it into a future year’s contribution limit.

Missed RMDs

At age 73, you must take required minimum distributions from your traditional IRA and most employer plans each year.¹⁴ Miss one and the penalty is 25% of the shortfall. Form 5329 is where you report the required amount, the actual distribution, and the resulting penalty.

There’s a meaningful escape valve. If you correct the shortfall within the correction window, which generally runs through the end of the second tax year after the year you missed the RMD, the penalty drops from 25% to 10%.¹¹ You can also request a full waiver by writing “RC” (reasonable cause) next to the penalty line and attaching a letter explaining what happened. Medical emergencies and custodian errors are the kinds of reasons the IRS tends to accept.

Two Situations the Forms Don’t Flag

Two reporting traps catch people even when the forms arrive correctly.

Qualified charitable distributions. If you’re 70½ or older, you can direct up to $111,000 per year (the 2026 inflation-adjusted limit) from your traditional IRA straight to a qualifying charity. QCDs count toward your RMD but are excluded from taxable income.¹⁵ The reporting catches people off guard. Your custodian issues a standard 1099-R showing the full distribution in Box 1 with no special code identifying it as a QCD. You enter the full amount on Line 4a of Form 1040, enter only the taxable portion (which may be zero) on Line 4b, and write “QCD” next to the line.¹⁶ Skip the notation and the IRS may treat the entire distribution as taxable.

Inherited accounts. Distributions from an inherited IRA or employer plan carry Code 4 in Box 7, which exempts the distribution from the 10% early withdrawal penalty regardless of the beneficiary’s age.² The distribution is still taxable as ordinary income if the original account was a traditional IRA or pre-tax employer plan. Under the SECURE Act, most non-spouse beneficiaries who inherit from someone who died after 2019 must empty the account within 10 years of the original owner’s death, and may also need annual RMDs during that window if the original owner had already reached RMD age.¹⁴ Surviving spouses, minor children, disabled or chronically ill beneficiaries, and beneficiaries no more than 10 years younger than the deceased have longer distribution periods.

Fixing a Wrong 1099-R

If your 1099-R has the wrong distribution code or wrong dollar amount, contact the custodian first and ask for a corrected form. If you haven’t received the correction by the end of February, call the IRS at 800-829-1040. The IRS will contact the custodian for you and send Form 4852, which serves as a substitute for a missing or incorrect 1099-R.¹⁷ If the filing deadline arrives and you still don’t have a corrected form, file using Form 4852 with your best estimates. If the eventual corrected 1099-R shows different figures, file Form 1040-X to amend. Starting this process in January rather than April saves real headaches.

1
Internal Revenue Service. About Form 1099-R
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Internal Revenue Service. Instructions for Forms 1099-R and 5498
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Internal Revenue Service. Publication 590-B, Distributions from Individual Retirement Arrangements
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Internal Revenue Service. Form 5498 – IRA Contribution Information
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Internal Revenue Service. 401(k) Limit Increases to $24,500 for 2026, IRA Limit Increases to $7,500
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Internal Revenue Service. Common Errors on Form W-2 Codes for Retirement Plans
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Internal Revenue Service. Retirement Plan FAQs Regarding Contributions
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Internal Revenue Service. About Form 8606, Nondeductible IRAs
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Internal Revenue Service. Instructions for Form 8606
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Internal Revenue Service. About Form 5329, Additional Taxes on Qualified Plans and Other Tax-Favored Accounts
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Internal Revenue Service. Instructions for Form 5329
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Internal Revenue Service. Retirement Topics – Exceptions to Tax on Early Distributions
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Office of the Law Revision Counsel. 26 U.S. Code 4973 – Tax on Excess Contributions to Certain Tax-Favored Accounts
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Internal Revenue Service. Retirement Plan and IRA Required Minimum Distributions FAQs
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Internal Revenue Service. 2026 Amounts Relating to Retirement Plans and IRAs
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Internal Revenue Service. Seniors Can Reduce Their Tax Burden by Donating to Charity Through Their IRA
17
Internal Revenue Service. Form W-2 and Form 1099-R (What to Do if Incorrect or Not Received)