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A code T 1099-R is reporting a distribution from a Roth IRA that is not subject to early withdrawal penalty but the financial institution issuing the 1099-R does not know if the 5-year holding period to make the distribution a qualified (and therefore entirely tax free) distribution has been met.
As your distribution is not taxable, Code T in the 1099-R for a Roth IRA distribution means that there is an exception. What do all the codes in Box 7 of the 1099-R mean? The code (s) in Box 7 of your 1099-R helps identify the type of distribution you received.
Roth IRA. For a distribution from a Roth IRA, report the total distribution in box 1 and leave box 2a blank except in the case of an IRA revocation or account closure and a recharacterization, earlier. Use Code J, Q, or T as appropriate in box 7. Use Code 8 or P, if applicable, in box 7 with Code J. Do not combine Code Q or T with any other codes.
Distributions from an inherited Roth IRA are reported with either code T or code Q. Other codes are used only for other types of retirement accounts.
Use Code J, Early distribution from a Roth IRA, to report a Roth IRA distribution when the IRA owner is under age 59½ and codes Q and T do not apply. But use code 2 for an IRS levy and code 5 for a prohibited transaction.
This interview will help you determine if your distribution from a Roth IRA or designated Roth account is taxable. This topic doesn't address either the return of a Roth IRA contribution or return of a prior year's excess contribution, or a corrective distribution of excess contribution from a designated Roth account.
Distributions of Roth IRA assets from regular participant contributions and from nontaxable conversions of a traditional IRA can be taken at any time, tax- and penalty-free.
Code T - Roth IRA distribution, exception applies Use Code T for a distribution from a Roth IRA if you do not know if the 5-year holding period has been met but: The participant has reached age 59 1/2, or; The participant died, or; The participant is disabled.
Use Code T for a distribution from a Roth IRA if you do not know if the 5-year holding period has been met but: The participant has reached age 59 1/2, The participant died, or
Details about Roth IRAs are contained in Publication 590-A, Contributions to Individual Retirement Arrangements (IRAs) and Publication 590-B, Distributions from Individual Retirement Arrangements (IRAs) and include: Setting up your Roth IRA; Contributions to your Roth IRA; and; Distributions (withdrawals) from your Roth IRA. Differences between ...