What It’s Used for, and Who Should File It


What Is Kind 1099-R: Distributions from Pensions, Annuities, Retirement or Revenue-Sharing Plans?

Kind 1099-R: Distributions From Pensions, Annuities, Retirement, or Revenue-Sharing Plans is an Inner Income System (IRS) tax kind used for reporting passive earnings and distributions from retirement plans. The shape offers particularly with annuities, profit-sharing plans, retirement plans, particular person retirement accounts (IRAs), insurance coverage contracts, or pensions. 

The shape is certainly one of many within the 1099 collection. They’re referred to as data returns and are used to report numerous sorts of earnings that an individual could obtain apart from their wage, reminiscent of unbiased contractor earnings, curiosity, dividends, or authorities funds.

Key Takeaways

  • Kind 1099-R is used to report distributions from annuities, profit-sharing plans, retirement plans, IRAs, insurance coverage contracts, or pensions. 
  • Anybody who receives a distribution over $10 ought to obtain a 1099-R kind.
  • The shape is offered by the plan issuer.
  • Kind 1099-R can also be used to file demise or incapacity advantages that could be paid out to a beneficiary’s property.
  • Account rollovers and loans may be recorded on kind 1099-R.

Who Can File Kind 1099-R?

In accordance with the IRS, an entity that manages any of the accounts listed beneath is required to fill out a 1099-R kind for every distribution of over $10:

As well as, rollover transfers from one retirement account to a different can even be recorded on kind 1099-R. A direct rollover is recorded with the distribution code G or H in field 7.

Some plans permit people to borrow towards the financial savings of their retirement account, offered that they repay the mortgage with curiosity over time. These loans usually are not recorded on kind 1099-R, since they don’t seem to be thought-about a distribution. Nonetheless, if the borrower fails to make common funds, the missed funds shall be thought-about an early distribution and reported on kind 1099-R with the distribution code L. These distributions are thought-about taxable earnings and will incur early withdrawal penalties.

Like most 1099s, 1099-R varieties should be despatched to recipients by January 31 of the yr following the tax yr. Anybody who receives a 1099-R should embrace the quantity proven on it of their earnings tax return and pay relevant taxes.

In case you obtain a 1099-R, understand that not all distributions from retirement or tax-deferred accounts are topic to tax. A direct rollover from a 401(ok) plan to an IRA is one instance. If you’re uncertain whether or not a distribution is taxable, it might be a good suggestion to seek the advice of with a tax skilled.

A person who receives a 1099-R kind in error ought to instantly contact the plan custodian to rectify the state of affairs and keep away from submitting an incorrect tax return.

Info Included on Kind 1099-R

As famous above, Kind 1099-R is used to file and report distributions from retirement accounts. Along with the recipient’s figuring out data, together with their title, date of start, and different private knowledge, it additionally consists of details about the character of the cash being distributed.

This denotes details about the proprietor’s contributions to the account, the unrealized worth of any securities held in it, capital beneficial properties, and any taxes which might be due on the distribution. This data is then utilized by the proprietor of the account after they file their annual taxes.

Methods to File Kind 1099-R

The shape is offered by the plan issuer, who should give a replica to the IRS, the recipient of the distribution, and the recipient’s state, metropolis, or native tax division. As with different IRS varieties, the 1099-R kind also needs to embrace the payer’s title, tackle, phone quantity, and taxpayer identification quantity (TIN). It also needs to have the recipient’s title, tackle, and taxpayer identification quantity, which for many particular person taxpayers is their Social Safety Quantity (SSN).

Among the different objects included on the shape are the gross distribution paid through the tax yr, the quantity of taxable distribution, the federal earnings tax withheld at supply, any contributions made to the funding, or insurance coverage premiums paid, and a code representing the kind of distributions made to the plan holder.

A 1099-R kind makes use of quite a lot of numbered and lettered codes to point the kind of distribution. They’re entered in Field 7 on the shape. A desk of the codes is included within the directions.

Kind 1099-R.


All copies of Kind 1099-R can be found on the IRS web site.

Different Related Types

Kind 1099-R is certainly one of many various kinds of 1099 varieties, collectively known as the data return varieties. Info returns are utilized by the IRS to maintain taxpayers from underreporting their earnings. Every sort of data return is meant to seize a unique sort of cost or transaction. Though there are roughly 16 sorts of data returns, most taxpayers will solely ever obtain a handful of them. Listed here are the most typical Kind 1099s.

Kind 1099-INT: Curiosity Earnings

Kind 1099-INT is issued by all monetary establishments to traders on the finish of the yr. It features a breakdown of all sorts of curiosity earnings and associated bills. All monetary establishments and payers of curiosity should challenge a 1099-INT for any occasion to whom they paid not less than $10 of curiosity through the yr.

Kind 1099-DIV: Dividends and Distributions

Kind 1099-DIV is distributed by banks and different monetary establishments to traders who obtain dividends and distributions from any sort of funding throughout a calendar yr. Traders can obtain a number of 1099-DIVs. Every 1099-DIV kind ought to be reported on a taxpayer’s tax submitting.

Kind 1099-MISC: Miscellaneous Earnings

Unbiased contractors, freelancers, sole proprietors, and self-employed people obtain Kind 1099-MISC from every consumer that paid them $600 or extra in a calendar yr. This kind can also be used to report miscellaneous compensation, reminiscent of hire, prizes, awards, healthcare funds, and funds to an legal professional.

Kind 1099-Ok: Fee Card and Third Celebration Community Transactions

Kind 1099-Ok studies the gross quantity of all reportable cost transactions. Taxpayers are despatched a Kind 1099-Ok from a cost settlement entity in the event that they obtain funds in settlement of reportable cost transactions. A reportable cost transaction is a cost card transaction or a third-party community transaction, reminiscent of Venmo, Zelle, and Paypal.

Reportable transactions embrace any that come up from cost card transactions, reminiscent of debit, credit score, and pay as you go playing cards. Any transactions which might be settled by third-party cost networks additionally qualify. The desk beneath units out minimal reporting thresholds.

Minimal Reporting Thresholds for Kind 1099-Ok
Returns  Gross Funds  Transactions 
For calendar years earlier than 2022  $20,000+ 200+
For calendar years after 2021 $600+ Any quantity

Supply: Understanding Your Kind 1099-Ok (IRS)

In different phrases, taxpayers ought to obtain a 1099-Ok from all cost settlement entities that course of debit card, bank card, or pay as you go bank card funds on the taxpayer’s behalf and from any PSE that processes greater than $600 in third-party community transactions as of 2022. Funds to and from members of the family and mates usually are not reportable transactions.

Kind 1099-B: Proceeds From Dealer and Barter Trade Transactions

Kind 1099-B is utilized by brokerages and barter exchanges to file prospects’ beneficial properties and losses throughout a tax yr. Particular person taxpayers will obtain this kind (already stuffed out) from their brokers or barter trade.

Kind 1099-G: Sure Authorities Funds

Taxpayers obtain Kind 1099-G in the event that they obtain unemployment compensation funds, state or native earnings tax refunds, or sure different funds from a authorities or authorities company. In case you obtain this kind, you might have to report a number of the data in your earnings tax return.

How Do I Get a Copy of My 1099-R Kind?

The IRS requires plan managers to fill out and ship kind 1099-R by January 31 within the yr following a distribution of $10 or extra. In case you lose or don’t obtain your kind 1099-R, you’ll be able to request a substitute by contacting the corporate that manages your plan or retirement account.

How Do I Report Kind 1099-R on Kind 1041?

Kind 1041 is used to report earnings taxes for an property or belief. Within the occasion {that a} demise profit or retirement distribution is paid out to a belief or property, this earnings is recorded on Line 8: Different Earnings. As well as, a replica of the shape 1099-R ought to be connected to the 1041 that it’s being utilized to.

What Are the Distribution Codes for Kind 1099-R?

Distribution codes file the kind of account that retirement funds are being distributed from and the character of the distribution. For instance, Roth account distributions are recorded as code B, and early distributions from a Roth IRA are recorded beneath code J. These codes are additionally used to point if there are any particular circumstances for the recipient, reminiscent of code 3 (incapacity) or code 4 (demise). The total record of codes is listed in Desk 1 of the directions for kind 1099-R.

The Backside Line

Kind 1099-R is certainly one of many paperwork used to file taxable funds for the interior income system. Whereas it might appear difficult, most individuals won’t ever have to fill out a kind 1099-R by themselves. As a substitute, they need to mechanically obtain the shape each time they take a distribution from a pension or retirement account.