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Employee Plans Compliance Unit (EPCU) - Current Projects - Form 1099R-72(t) Project

Why did I receive an EPCU Compliance Check Letter?

Our records show that you received a Form 1099-R for an early taxable distribution from a retirement plan and you did not report it on your personal income tax return (Form 1040 series).

What is the EPCU attempting to determine?

We want to verify the Form 1099-R was issued and reported correctly.

What actions do I need to take?

Review your 2009 personal income tax return and your Form 1099-R. You should have reported the taxable distribution on line 15b or 16b of your Form 1040 or line 11b or 12b of your Form 1040A. You should not have filed a Form 1040EZ if you received a premature taxable distribution.

You should have reported the additional 10% tax, if it applied to you, on line 58 of your Form 1040 for tax year 2009. You should not have filed a Form 1040A or a Form 1040EZ if you owe the additional 10% tax.

Exceptions

If you completed a rollover on the entire distribution into another qualified retirement plan, an IRA, or a SEP within 60 days from the date you received it, it is considered a tax-free distribution and you did not need to report the distribution amount on your personal income tax return for 2009.

There are various exceptions to the additional 10% tax, in addition to rollovers of entire distributions as described above; see the Chart showing exceptions to the 10% additional tax for additional information.

If You Have Questions

Please feel free to contact the person listed in the cover letter with questions about this project and how it relates to your situation.

Background

The activities of this project include extensive research to determine if the Form 1099-R was properly reported on the individual’s income tax return or if a rollover occurred. The EPCU will mail an information request to individuals that appear to not have reported their distribution on their income tax return or had an eligible rollover. EPCU will review each response and will determine if the individual has complied with the required handling or reporting of the taxable distribution and/or the additional 10% tax. An individual contacted during the project remains subject to examination and will be contacted if selected.

The information gathered from this project will result in a report issued by the IRS describing responses and identifying areas where we need additional education, guidance, or outreach.

Other Resources

Page Last Reviewed or Updated: 19-Feb-2014