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Form 5329 to Correct Improper Box 7 code

On the Form 1099-R, check to Force Form 5329 –(If there is an early distribution penalty because the taxpayer is less than 59-1/2 years old, the penalty will show in the Other Taxes section of the 1040, Line 58 and no 5329 is required.) However if there is an exception to the penalty, check the box to force a Form 5329. On the Form 5329, the amount subject to penalty is shown on line 1  
  • To view the exception to penalty codes:
    • Check out Pub 4012, pages H-1 & H-2
    • Use F1 to reach TWO Help
      • Click on IRS Codes:
         IRS Codes – Exception codes for Add’l Tax on Early Distribution
In TaxWise:  Enter the appropriate code and the amount NOT subject to additional penalty.  Check out the Form 1040,   line 58 to ensure the correction is proper.
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