Are you filing a Form 1099-R for your client? Find the explanation for box 7 codes here.
| Box | Explanation | Used with, if applicable |
| 1 | (1) Early distribution (taxpayer is under age 59-1/2) and there is no known exception to the early distribution penalty. Generally file Form 5329, however for a rollover to a traditional IRA of the entire taxable part of the distribution, do not file Form 5329; (2) Distribution for medical expenses, health insurance premiums, qualified higher education expenses, a first-time home purchase, a qualified reservist distribution, or a qualified birth or adoption distribution under section 72(t)(2)(B), (D), (E), (F), (G), or (H); (3) Taxpayer is age 59-1/2 or older and has modified a series of substantially equal periodic payments under section 72(q), (t), or (v) prior to the end of the 5-year period which began with the first payment. |
8, B, D, K, L, M, P |
| 2 | Early distribution (taxpayer is under age 59-1/2) but an exception to the early distribution penalty applies. See the instructions for Form 5329 for the list of exceptions. | 8, B, D, K, L, M, P |
| 3 | Disability per section 72(m)(7). | D |
| 4 | (1) Payment to a decedent's beneficiary; (2) Employer death benefit payment separate from a pension, profit-sharing, or retirement plan; (3) Reportable death benefits (under section 6050Y). |
8, A, B, D, G, H, K, L, M, P |
| 5 | Prohibited transaction involving the IRA account, i.e., the account is no longer an IRA. | |
| 6 | Section 1035 exchange (tax-free exchange of life insurance, annuity, qualified long-term care insurance, or endowment contracts). | W |
| 7 | (1) Normal distribution from a traditional IRA, 401(k), and 403(b); (2) Roth IRA conversion; (3) Distribution from a life insurance, annuity, or endowment contract; (4) Income from a life insurance contract that failed to satisfy the requirements of section 7702. |
A, B, D, K, L, M |
| 8 | (1) IRA distribution under section 408(d)(4); (2) Corrective distribution of excess deferrals, excess contributions, and excess aggregate contributions taxable in the current year. |
1, 2, 4, B, J, K |
| 9 | Cost of current life insurance protection. | |
| A | May be eligible for the 10-year tax option method of computing the tax on a lump sum distribution. (See the instructions for Form 4972). | 4, 7 |
| B | Designated Roth account distribution. (If an amount is also reported in box 10, see the instructions for Form 5329 and Publication 575.) | 1, 2, 4, 7, 8, G, L, M, P, U |
| C | Reportable death benefits under section 6050Y. | D |
| D | Annuity payments from nonqualified annuities and distributions from life insurance contracts that may be subject to tax under section 1411 (a distribution from any plan or arrangement not described in section 401(a), 403(a), 403(b), 408, 408A, or 457(b)). | 1, 2, 3, 4, 7, C |
| E | Distributions under Employee Plans Compliance Resolution System (EPCRS). | |
| F | Charitable gift annuity. | |
| G | (1) Direct rollover of a distribution from and to a qualified plan, a section 403(b) plan, a governmental section 457(b) plan, or an IRA; (2) a direct payment from an IRA to an accepting employer plan; (3) An In-Plan Roth Rollover (IRR) that is a direct rollover. |
4, B, K |
| H | Direct rollover of a designated Roth account distribution to a Roth IRA. | 4 |
| J | Early distribution from a Roth IRA, no known exception (generally the taxpayer is under age 59 1/2). | 8, P |
| K | Distribution of traditional IRA assets not having a readily available FMV. | 1, 2, 4, 7, 8, G |
| L | Loans treated as deemed distributions under section 72(p). | 1, 2, 4, 7, B |
| M | Qualified plan loan offset. | 1, 2, 4, 7, B |
| N | Recharacterized IRA contribution made for the current year and recharacterized to another type of IRA in the current year. | |
| P | Excess contributions plus earnings/excess deferrals taxable in the prior year. | 1, 2, 4, B, J |
| Q | Qualified distribution from a Roth IRA, i.e., participant has met the 5-year holding period. | |
| R | Recharacterized IRA contribution made for the prior year and recharacterized in the current year. | |
| S | Early distribution from a SIMPLE IRA in the first 2 years, the taxpayer is under age 59-1/2, and there is no known exception under section 72(t). | |
| T | Roth IRA distribution, exception applies. (The payer doesn't know if the 5-year holding period has been met.) | |
| U | Dividend distributed from ESOP under section 404(k). | B |
| W | Charges or payments for purchasing qualified long-term care insurance contracts under combined arrangements. | 6 |
Additional information:
Instructions for Forms 1099-R and 5498
Publication 575: Pension & Annuity Income
IRC Section 72, Annuities; certain proceeds of endowment and life insurance contracts
