A Guide to IRA Tax Forms

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With Tax Day two months away, let’s review a few of the documents that you may receive in association with your self-directed IRA, Solo 401(k), or Health Savings Account activities from 2020.

 

Browse your account information through your client portal at portal.ndtco.com.

 

Form 1099-R

You will receive a Form 1099-R if you took a distribution from your account last year. This is true even if you took a qualified Roth distribution on which you’ll owe $0 in taxes.

If you haven’t already, and if applicable, you’ll receive your Form 1099-R soon. NDTCO will also send a copy to the IRS, so you won't need to include your copy with your tax return, nor will you need to file a separate return. Taxes owed on distributions are lumped in with your regular income taxes, meaning you would simply add the taxable amount to your 1040 and carry on with your normal calculations.

2020 Account Statement

Though not technically a tax form, your NDTCO account statement can help you get your affairs in order. Your statement will highlight your 2020 account activities and will be available on the Documents dashboard in your client portal toward the end of February.

Form 5498

Form 5498 will report the fair market value of your account as of December 31, 2020. It will also show any contributions you made during the prior year, including deposits of personal money and rollover contributions that you brought from another qualified plan (click here to review important differences between rollovers, which are reportable, and transfers, which are not).

If you have a pre-tax account like a Traditional IRA, any deposits made can be deductible from your income for tax purposes. You’ll need to report any deductible balance on your income tax return and complete your calculations accordingly.

NDTCO does not issue Form 5498s until after the tax filing deadline. With this in mind, you may be asking:

  • “How can I report my tax-deductible contribution if I don’t get my 5498 until after the filing deadline?”
  • “I did a rollover into my NDTCO account last year; how can I prove to the IRS that my rollover distribution was properly re-deposited?”

Both of these issues can be addressed by your 2020 account statement, which you’ll receive well before Tax Day. The information you see on your statement will be same as reported on Form 5498, so you can complete your taxes with confidence upon receipt of your statement in the next few weeks.

Ask for Help!

NDTCO does not provide tax advice, but we encourage you to discuss any tax-specific questions or concerns with your accountant or other tax professional. Contact our sister company, IRA Tax Services, if you need tax assistance related to self-directed plans.

If you have any questions about your tax-advantaged accounts, your tax documents, or accessing your account information in the client portal, feel free to give us a call at 877-742-1270.