Every U.S. taxpayer has to fill out a variety of different tax forms. This way they can get the proper tax treatment for tier annual income. And this income also includes the amount earned as a distribution from the retirement plan if they have any. Along with this, the income that they received from an education savings account is also included in that. If for any reason you fail to fill out all the required forms before their given deadline; then you will also have to pay some penalty charges. And in that case, the amount will become way more than the amount that you actually owe as the tax.
IRS Form 5329 is filed when a taxpayer has a retirement plan. Or there is a requirement from the ESA to indicate whether he/she has to pay the ten percent early-distribution penalty or any other charges to the IRS. This tax form is for Additional Taxes on Qualified Retirement Plans and Other Tax-Favored Accounts. Now it is obvious for you to have some questions in mind like what is this form and how to file this. You have come to the right place as you will get all the answers.
You will have to file the IRS Form 5329 if you have a retirement plan or ESA. And you need to indicate whether you have to pay the 10 percent early-distribution or any other penalty charges to the IRS.
If a U.S. taxpayer received a distribution from any retirement plan but he/she has not reached the age of 59.5 years then an early-distribution penalty has to be paid. This penalty is ten percent of the distributed amount to the IRS. The case can be different when there is some unique exception.
At this point, you must have realized how important it is to fill out this form on time. But doing everything on your own can become a little bit overwhelming. This is when the need of hiring a professional tax expert arises. If you are wondering how to get the proper assistance then do not worry. We have got your back. There is no need to make Google searches like ‘Tax Services Near Me’. You can take virtual tax services as well. Not sure how to get started? You can call us on +1-888-660-0575. We are available 24x7.