Form 5498 - Why?

Posted by starrin on May 24, 2009, 2:16 pm

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For the first time ever, My wife and I have gotten the subject form
relative to our IRA's. Doesn't seem to contain any information of
value ( each shows only the rollover contribution and fair market
value of 2008 IRAs). Why do I need this, and will I need it in 2009 -
when each of these 2 IRAs roll again? It says an RMD needs to be made
in 2009, but I know that. I get nervous when I get an 2008 IRA tax
form in 2009 well after the filing deadline.

========================================= MODERATOR'S COMMENT:
It tells you 2008 year-end values so you can calculate your RMD
for 2009. If there was an RMD for 2009. Congress gave us all a one-year
pass from having to take RMDs, and that's for tax year 2009. Many
taxpayers rely on their IRA costodians to calculate and pay the RMD.

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Posted by Mark Bole on May 24, 2009, 3:19 pm

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starrin wrote:

> For the first time ever, My wife and I have gotten the subject form

> relative to our IRA's.

You should have gotten one every year you had an IRA.

> Doesn't seem to contain any information of

> value ( each shows only the rollover contribution and fair market

> value of 2008 IRAs).

There are up to 15 boxes of information (boxes 12-15 new for 2009)
reportable on Form 5498, although many of them don't apply for most
recipients, I assume. One of the most important things it reports are
*contributions*, which are not reported anywhere else. Some
contributions are allowed up to 3.5 months after the end of the tax
year, so the deadline for the form had to allow for that.

> Why do I need this, and will I need it in 2009 -

> when each of these 2 IRAs roll again?

Whether you need it or not, the IRS rules require the issuer to send it.
A specific caution in the instructions states it must be issued even if
RMD's have begun.

What do you mean, "roll again"? A roll-over does not involve repeat
transactions.

> It says an RMD needs to be made

> in 2009, but I know that. I get nervous when I get an 2008 IRA tax

> form in 2009 well after the filing deadline.

It's allowed a June 1st deadline by the IRS, so no worries there. You
should have received a statement from the custodian by Jan. 31st with
your RMD information (perhaps a year-end account statement).

-Mark Bole

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by starrin on May 25, 2009, 11:18 am

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Starrin queried

>> Why do I need this, and will I need it in 2009 -

>> when each of these 2 IRAs roll again?

Mark, in part, replied

>What do you mean, "roll again"? A roll-over does not involve repeat

>transactions.

Maybe bad choice of words. It was put in a 6 month CD as that is
where the highest interest rates were. That CD will be renewed (?)
for another 6 months first week in June. Is renewed the right word.

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by Mark Bole on May 25, 2009, 12:28 pm

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starrin wrote:

> Starrin queried

>>> Why do I need this, and will I need it in 2009 -

>>> when each of these 2 IRAs roll again?

> Mark, in part, replied

>> What do you mean, "roll again"? A roll-over does not involve repeat

>> transactions.

> Maybe bad choice of words. It was put in a 6 month CD as that is

> where the highest interest rates were. That CD will be renewed (?)

> for another 6 months first week in June. Is renewed the right word.

Yes, "renewed" is a better term, although I know banks sometimes refer
to the CD automatic renewal as a "roll over".

In tax terms, the roll-over of an IRA has specific tax-related meaning,
regardless of whether the IRS includes bank CD's or other investments.

-Mark Bole

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>