Form 5329 Exceptions
Form 5329 is used to report additional taxes on distributions from qualified retirement plans, including IRAs, and other tax-favored accounts. While the form generally applies to early distributions, there are specific exceptions where the 10% additional tax does not apply.
When the 10% Additional Tax Does Not Apply
- Qualified HSA Funding Distribution: The additional tax does not apply to a qualified HSA funding distribution from an IRA (other than a SEP or SIMPLE IRA). For details, refer to the Health Savings Accounts section in Publication 969.
- Conversion from Traditional IRA to Roth IRA: Distributions from a traditional IRA that were converted to a Roth IRA are exempt from the 10% additional tax.
- Rollover from Qualified Retirement Plan to Roth IRA: A rollover from a qualified retirement plan to a Roth IRA is not subject to the additional tax.
- In-Plan Roth Rollover: An in-plan Roth rollover is also exempt from the 10% additional tax.
Other Important Notes
- Form 5329 must be filed with your Form 1040, 1040-SR, or 1040-NR by the due date, including extensions.
- If you are filing Form 5329 for a prior year, you must use the version of the form for that year. If you are amending your return, file Form 5329 with Form 1040-X.
- If you do not need to file an income tax return, you can file Form 5329 by itself, but it cannot be filed electronically. You must include your address, signature, and date on the form.
Source:
Instructions for Form 5329 (2025)
Disclaimer: Always verify information with official Federal or State Department of Revenue Forms and Instructions.