8863 Education Credits (Hope and Lifetime Learning Credits)

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I.R.S. SPECIFICATIONS
TO BE REMOVED BEFORE PRINTING
INSTRUCTIONS TO PRINTERS
FORM 5329, PAGE 1 of 2
MARGINS: TOP 13mm (1⁄ 2 ") CENTER SIDES.
PRINTS: HEAD TO HEAD
PAPER: WHITE WRITING, SUB. 20.
INK: BLACK
FLAT SIZE: 203mm (8") 3 279mm (11")
PERFORATE: (NONE)
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5329

Action

Revised proofs
requested

OMB No. 1545-0074

2006

f
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Attach to Form 1040 or Form 1040NR.
©

Attachment
Sequence No.

See separate instructions.

Name of individual subject to additional tax. If married filing jointly, see instructions.

©

Signature

O.K. to print

Additional Taxes on Qualified Plans
(Including IRAs) and Other Tax-Favored Accounts

Department of the Treasury
(99)
Internal Revenue Service

Fill in Your Address Only
If You Are Filing This
Form by Itself and Not
With Your Tax Return

Date

29

Your social security number

Home address (number and street), or P.O. box if mail is not delivered to your home

Apt. no.

City, town or post office, state, and ZIP code

If this is an amended
return, check here ©

If you only owe the additional 10% tax on early distributions, you may be able to report this tax directly on Form 1040, line 60, or
on Form 1040NR, line 55, without filing Form 5329. See the instructions for Form 1040, line 60, or for Form 1040NR, line 55.

Part I

Additional Tax on Early Distributions

Complete this part if you took a taxable distribution (other than a qualified hurricane distribution), before you reached age
591⁄ 2 , from a qualified retirement plan (including an IRA) or modified endowment contract (unless you are reporting this tax
directly on Form 1040—see above). You may also have to complete this part to indicate that you qualify for an exception to
the additional tax on early distributions or for certain Roth IRA distributions (see instructions).

1
2
3
4

Early distributions included in income. For Roth IRA distributions, see instructions
Early distributions included on line 1 that are not subject to the additional tax (see instructions).
Enter the appropriate exception number from the instructions:
Amount subject to additional tax. Subtract line 2 from line 1

Additional tax. Enter 10% (.10) of line 3. Include this amount on Form 1040, line 60, or Form
1040NR, line 55
Caution: If any part of the amount on line 3 was a distribution from a SIMPLE IRA, you may have
to include 25% of that amount on line 4 instead of 10% (see instructions).

Part II

5
6
7
8

1
2
3
4

Additional Tax on Certain Distributions From Education Accounts

Complete this part if you included an amount in income, on Form 1040, line 21, from a Coverdell education savings
account (ESA) or a qualified tuition program (QTP).
5
Distributions included in income from Coverdell ESAs and QTPs
6
Distributions included on line 5 that are not subject to the additional tax (see instructions)
7
Amount subject to additional tax. Subtract line 6 from line 5
Additional tax. Enter 10% (.10) of line 7. Include this amount on Form 1040, line 60, or Form 1040NR, line 55
8

Part III

Additional Tax on Excess Contributions to Traditional IRAs
Complete this part if you contributed more to your traditional IRAs for 2006 than is allowable or you had an amount
on line 17 of your 2005 Form 5329.

9
10
11
12
13
14
15
16
17

Enter your excess contributions from line 16 of your 2005 Form 5329 (see instructions). If zero,
go to line 15
If your traditional IRA contributions for 2006 are less than your
10
maximum allowable contribution, see instructions. Otherwise, enter -011
2006 traditional IRA distributions included in income (see instructions)
12
2006 distributions of prior year excess contributions (see instructions)
Add lines 10, 11, and 12
Prior year excess contributions. Subtract line 13 from line 9. If zero or less, enter -0Excess contributions for 2006 (see instructions)
Total excess contributions. Add lines 14 and 15
Additional tax. Enter 6% (.06) of the smaller of line 16 or the value of your traditional IRAs on December 31, 2006
(including 2006 contributions made in 2007). Include this amount on Form 1040, line 60, or Form 1040NR, line 55

Part IV

18
19
20
21
22
23
24
25

9

13
14
15
16
17

Additional Tax on Excess Contributions to Roth IRAs

Complete this part if you contributed more to your Roth IRAs for 2006 than is allowable or you had an amount on line
25 of your 2005 Form 5329.
18
Enter your excess contributions from line 24 of your 2005 Form 5329 (see instructions). If zero, go to line 23
If your Roth IRA contributions for 2006 are less than your maximum
19
allowable contribution, see instructions. Otherwise, enter -020
2006 distributions from your Roth IRAs (see instructions)
21
Add lines 19 and 20
22
Prior year excess contributions. Subtract line 21 from line 18. If zero or less, enter -023
Excess contributions for 2006 (see instructions)
24
Total excess contributions. Add lines 22 and 23
Additional tax. Enter 6% (.06) of the smaller of line 24 or the value of your Roth IRAs on December 31, 2006
(including 2006 contributions made in 2007). Include this amount on Form 1040, line 60, or Form 1040NR, line 55

For Paperwork Reduction Act Notice, see page 6 of the instructions.

Cat. No. 13329Q

25
Form

5329

(2006)

5
I.R.S. SPECIFICATIONS
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INSTRUCTIONS TO PRINTERS
FORM 5329, PAGE 2 of 2
MARGINS: TOP 13mm (1⁄ 2 ") CENTER SIDES.
PRINTS: HEAD TO HEAD
PAPER: WHITE WRITING, SUB. 20.
INK: BLACK
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PERFORATE: (NONE)
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Form 5329 (2006)

Part V

Page

2

Additional Tax on Excess Contributions to Coverdell ESAs

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Complete this part if the contributions to your Coverdell ESAs for 2006 were more than is allowable or you had an
amount on line 33 of your 2005 Form 5329.
26
27
28
29
30
31
32
33

Enter the excess contributions from line 32 of your 2005 Form 5329 (see instructions). If zero,
go to line 31

26

If the contributions to your Coverdell ESAs for 2006 were less than the
27
maximum allowable contribution, see instructions. Otherwise, enter -028
2006 distributions from your Coverdell ESAs (see instructions)
Add lines 27 and 28
Prior year excess contributions. Subtract line 29 from line 26. If zero or less, enter -0Excess contributions for 2006 (see instructions)
Total excess contributions. Add lines 30 and 31
Additional tax. Enter 6% (.06) of the smaller of line 32 or the value of your Coverdell ESAs on
December 31, 2006 (including 2006 contributions made in 2007). Include this amount on Form
1040, line 60, or Form 1040NR, line 55

29
30
31
32

Part VI

33

Additional Tax on Excess Contributions to Archer MSAs

Complete this part if you or your employer contributed more to your Archer MSAs for 2006 than is allowable or you
had an amount on line 41 of your 2005 Form 5329.
34
35
36
37
38
39
40
41

Enter the excess contributions from line 40 of your 2005 Form 5329 (see instructions). If zero,
go to line 39
If the contributions to your Archer MSAs for 2006 are less than the
35
maximum allowable contribution, see instructions. Otherwise, enter -036
2006 distributions from your Archer MSAs from Form 8853, line 10
Add lines 35 and 36
Prior year excess contributions. Subtract line 37 from line 34. If zero or less, enter -0Excess contributions for 2006 (see instructions)
Total excess contributions. Add lines 38 and 39
Additional tax. Enter 6% (.06) of the smaller of line 40 or the value of your Archer MSAs on
December 31, 2006 (including 2006 contributions made in 2007). Include this amount on Form
1040, line 60, or Form 1040NR, line 55

Part VII

42
43
44
45
46
47
48
49

34

37
38
39
40

41

Additional Tax on Excess Contributions to Health Savings Accounts (HSAs)
Complete this part if you, someone on your behalf, or your employer contributed more to your
HSAs for 2006 than is allowable or you had an amount on line 43 of your 2005 Form 5329.

Enter the excess contributions from line 48 of your 2005 Form 5329. If zero, go to line 47
If the contributions to your HSAs for 2006 are less than the maximum
43
allowable contribution, see instructions. Otherwise, enter -044
2006 distributions from your HSAs from Form 8889, line 14

42

Add lines 43 and 44
Prior year excess contributions. Subtract line 45 from line 42. If zero or less, enter -0Excess contributions for 2006 (see instructions)
Total excess contributions. Add lines 46 and 47
Additional tax. Enter 6% (.06) of the smaller of line 48 or the value of your HSAs on December 31, 2006 (including
2006 contributions made in 2007). Include this amount on Form 1040, line 60, or Form 1040NR, line 55

45
46
47
48

Part VIII

49

Additional Tax on Excess Accumulation in Qualified Retirement Plans (Including IRAs)
Complete this part if you did not receive the minimum required distribution from your qualified retirement plan.

50
51
52
53

50
51
52
53

Minimum required distribution for 2006 (see instructions)
Amount actually distributed to you in 2006
Subtract line 51 from line 50. If zero or less, enter -0Additional tax. Enter 50% (.50) of line 52. Include this amount on Form 1040, line 60, or Form 1040NR, line 55

Signature. Complete only if you are filing this form by itself and not with your tax return.

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Page 1 of 6

Instructions for Form 5329

14:18 - 17-JAN-2006

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

2005

Department of the Treasury
Internal Revenue Service

Instructions for Form 5329
Additional Taxes on Qualified Plans (Including IRAs)
and Other Tax-Favored Accounts

General Instructions
Section references are to the Internal
Revenue Code unless otherwise noted.

What’s New
The additional tax on early distributions
does not apply to qualified hurricane
distributions. See Form 8915, Qualified
Hurricane Retirement Plan Distributions
and Repayments, for more details.

Purpose of Form
Use Form 5329 to report additional
taxes on:
• Individual retirement arrangements
(IRAs),
• Other qualified retirement plans,
• Modified endowment contracts,
• Coverdell ESAs,
• Qualified tuition programs (QTPs),
• Archer MSAs, or
• Health savings accounts (HSAs).

Who Must File
You must file Form 5329 if any of the
following apply, except you do not have
to file Form 5329 to report a qualified
hurricane distribution.
• You received an early distribution
from a Roth IRA, the amount on Form
8606, line 23, is more than zero, and
you are required to enter an amount
that is more than zero on Form 5329,
line 1 (see Exception for Roth IRA
Distributions on page 2).
• You received an early distribution
from a qualified retirement plan (other
than a Roth IRA) and distribution code
1 is not shown in box 7 of Form
1099-R, Distributions From Pensions,
Annuities, Retirement or Profit-Sharing
Plans, IRAs, Insurance Contracts, etc.
Note. You do not have to file Form
5329 if distribution code 1 is correctly
shown in box 7 of all Forms 1099-R
and you owe the additional tax on each
Form 1099-R. Instead, see the
instructions for Form 1040, line 60, for
how to report the additional 10% tax
directly on that line.
• You meet an exception to the tax on
early distributions and distribution code
1 is shown in box 7 of Form 1099-R.
• You meet an exception to the tax on
early distributions from the list that
begins on page 2 but box 7 of your

Form 1099-R does not indicate an
exception or the exception does not
apply to the entire distribution.
• You received taxable distributions
from Coverdell ESAs or QTPs.
• The contributions for 2005 to your
traditional IRAs, Roth IRAs, Coverdell
ESAs, Archer MSAs, or HSAs exceed
your maximum contribution limit, or you
had a tax due from an excess
contribution on line 17, 25, 33, 41, or 43
of your 2004 Form 5329.
• You did not receive the minimum
required distribution from your qualified
retirement plan.
If you rolled over part or all of a

TIP distribution from a qualified
retirement plan, the part rolled
over is not subject to the additional tax
on early distributions. See the
instructions for Form 1040, lines 15a
and 15b or lines 16a and 16b, or Form
1040A, lines 11a and 11b or 12a and
12b, for how to report the rollover.

When and Where To File
File Form 5329 with your 2005 Form
1040 by the due date, including
extensions, of your Form 1040.
If you do not have to file a 2005
income tax return, complete and file
Form 5329 by itself at the time and
place you would be required to file
Form 1040. Be sure to include your
address on page 1 and your signature
and the date on page 2. Enclose, but
do not attach, a check or money order
payable to “United States Treasury” for
any taxes due. Write your SSN and
“2005 Form 5329” on the check.
Prior tax years. If you are filing Form
5329 for a prior year, you must use that
year’s version of the form. If you do not
have other changes, file Form 5329 by
itself (see above). If you have other
changes, file Form 5329 for that year
with Form 1040X, Amended U.S.
Individual Income Tax Return.

Definitions
Qualified retirement plan. A qualified
retirement plan includes:
• A qualified pension, profit-sharing, or
stock bonus plan (including a 401(k)
plan),
• A tax-sheltered annuity contract,
Cat. No. 13330R

• A qualified annuity plan, and
• An IRA.
For purposes of the additional tax on
early distributions, an eligible
governmental section 457 deferred
compensation plan is treated as a
qualified retirement plan, but only to the
extent that a distribution is attributable
to an amount transferred from a
qualified retirement plan (defined
above).
Note. Modified endowment contracts
are not qualified retirement plans.
Traditional IRAs. For purposes of
Form 5329, a traditional IRA is any IRA,
including a simplified employee pension
(SEP) IRA, other than a SIMPLE IRA or
Roth IRA.
Early distribution. Generally, any
distribution from your IRA, other
qualified retirement plan, or modified
endowment contract before you reach
age 591/2 is an early distribution.
Rollover. A rollover is a tax-free
distribution of assets from one qualified
retirement plan that is reinvested in
another plan or the same plan.
Generally, you must complete the
rollover within 60 days of receiving the
distribution. Any taxable amount not
rolled over must be included in income
and may be subject to the additional tax
on early distributions.
The IRS may waive the 60-day
requirement if failing to waive it would
be against equity or good conscience,
such as situations where a casualty,
disaster, or other events beyond your
reasonable control prevented you from
meeting the 60-day requirement. Also,
the 60-day period may be extended if
you had a frozen deposit. See Pub.
590, Individual Retirement
Arrangements (IRAs), for details.
Compensation. Compensation
includes wages, salaries, tips, bonuses,
and other pay you receive for services
you perform. It also includes sales
commissions, commissions on
insurance premiums, and pay based on
a percentage of profits. It includes net
earnings from self-employment, but
only for a trade or business in which
your personal services are a material
income-producing factor.

Page 2 of 6

Instructions for Form 5329

14:18 - 17-JAN-2006

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

For IRAs, treat all taxable alimony
received under a decree of divorce or
separate maintenance as
compensation.
Compensation does not include any
amounts received as a pension or
annuity and does not include any
amount received as deferred
compensation.
Taxable compensation is your
compensation that is included in gross
income reduced by any deductions on
Form 1040, lines 27 and 28, but not by
any loss from self-employment.

Additional Information
See Pub. 590; Pub. 560, Retirement
Plans for Small Business; Pub. 575,
Pension and Annuity Income; Pub. 970,
Tax Benefits for Education; and Pub.
4492, Information for Taxpayers
Affected by Hurricanes Katrina, Rita,
and Wilma.

Specific Instructions
Joint returns. If both you and your
spouse are required to file Form 5329,
complete a separate form for each of
you. Include the combined tax on Form
1040, line 60.
Amended return. If you are filing an
amended 2005 Form 5329, check the
box at the top of page 1 of the form. Do
not use the 2005 Form 5329 to amend
your return for any other year. Instead,
see Prior tax years on page 1.

Part I—Additional Tax
on Early Distributions
In general, if you receive an early
distribution (including an involuntary
cashout) from an IRA, other qualified
retirement plan, or modified endowment
contract, the part of the distribution
included in income generally is subject
to an additional 10% tax. But see
Exception for Roth IRA Distributions on
this page.
The additional tax on early
distributions does not apply to any of
the following:
• A qualified hurricane distribution. See
Form 8915 for more details.
• A distribution from a traditional or
SIMPLE IRA that was converted to a
Roth IRA.
• A distribution of certain excess IRA
contributions (see the instructions for
lines 15 and 23).
Note. Any related earnings withdrawn
with excess contributions are subject to
the additional tax on early distributions
if you were under age 591/2 at the time
of the distribution.

• A distribution of excess contributions
from a qualified cash or deferred
arrangement.
• A distribution of excess aggregate
contributions to meet nondiscrimination
requirements for employee
contributions and matching employer
contributions.
• A distribution of excess deferrals.
• A distribution from an eligible
governmental section 457 deferred
compensation plan to the extent the
distribution is not attributable to an
amount transferred from a qualified
retirement plan (excluding an eligible
section 457 deferred compensation
plan).
See the instructions for line 2 on this
page for other distributions that are not
subject to the tax.

Line 1
Enter the amount of early distributions
included in income that you received
from:
• A qualified retirement plan, including
earnings on withdrawn excess
contributions to your IRAs included in
income in 2005, or
• A modified endowment contract
entered into after June 20, 1988.
Certain prohibited transactions, such
as borrowing from your IRA or pledging
your IRA assets as security for a loan,
are considered to be distributions and
may also cause you to owe the
additional tax on early distributions. See
Pub. 590 for details.

Exception for Roth IRA
Distributions
If you received an early distribution
from a Roth IRA, first allocate the
amount on your 2005 Form 8606, line
19 (not including any qualified hurricane
distributions), in the order shown, to the
amounts on the lines listed below (to
the extent a prior year distribution was
not allocable to the amount).
• Your 2005 Form 8606, line 20.
• Your 2005 Form 8606, line 22*.
• Your 1998 Form 8606, line 16.
• Your 1998 Form 8606, line 15.
• Your 1999 Form 8606, line 16.
• Your 1999 Form 8606, line 15.
• Your 2000 Form 8606, line 16.
• Your 2000 Form 8606, line 15.
• Your 2001 Form 8606, line 18.
• Your 2001 Form 8606, line 17.
• Your 2002 Form 8606, line 18.
• Your 2002 Form 8606, line 17.
• Your 2003 Form 8606, line 18.
• Your 2003 Form 8606, line 17.
• Your 2004 Form 8606, line 18.
• Your 2004 Form 8606, line 17.
• Your 2005 Form 8606, line 18.
• Your 2005 Form 8606, line 17.
• Your 2005 Form 8606, line 25c.

-2-

*If applicable, reduce this amount by
any amounts attributable to qualified
hurricane distributions.
Then, include on line 1 of Form 5329
the amount from your 2005 Form 8606,
line 25c, plus the amount, if any,
allocated to the amount on your 2005
Form 8606, line 20, and the amount, if
any, allocated to line 18 of your 2001
through 2005 Forms 8606. Also include
the amount, if any, from your 2005
Form 8606, line 20, on Form 5329, line
2, and enter exception number 09.
Example. You converted $20,000 from
a traditional IRA to a Roth IRA in 2001
and converted $10,000 in 2002. Your
2001 Form 8606 had $5,000 on line 17
and $15,000 on line 18 and your 2002
Form 8606 had $3,000 on line 17 and
$7,000 on line 18. You made Roth IRA
contributions of $2,000 for 2001 and
2002. You did not make any Roth IRA
conversions or contributions for 2003
through 2005, or take any Roth IRA
distributions before 2005. On July 9,
2005, at age 53, you took a $33,000
distribution from your Roth IRA. Your
2005 Form 8606 shows $33,000 on line
19; $29,000 on line 23 ($33,000 minus
$4,000 for your contributions on line 22)
and $0 on line 25a ($29,000 minus your
basis in Roth IRA conversions of
$30,000). First, $4,000 of the $33,000
is allocated to your 2005 Form 8606,
line 22; then $15,000 to your 2001
Form 8606 line 18; $5,000 to your 2001
Form 8606, line 17; and $7,000 to your
2002 Form 8606, line 18. The
remaining $2,000 is allocated to the
$3,000 on your 2002 Form 8606, line
17. On line 1, enter $22,000 ($15,000
allocated to your 2001 Form 8606, line
18, plus the $7,000 that was allocated
to your 2002 Form 8606, line 18). If you
take a Roth IRA distribution in 2006,
the first $1,000 will be allocated to the
$1,000 remaining from your 2002 Form
8606, line 17, and will not be subject to
the additional tax on early distributions.
Additional Information. For more
details, see Are Distributions Taxable?
in Pub. 590.

Line 2
The additional tax on early distributions
does not apply to the distributions
described below. Enter on line 2 the
amount that can be excluded. In the
space provided, enter the applicable
exception number (01-11).

No. Exception
01 Qualified retirement plan distributions if
you separated from service in or after
the year you reach age 55 (does not
apply to IRAs).

Page 3 of 6

Instructions for Form 5329

14:18 - 17-JAN-2006

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

02 Distributions made as part of a series of
substantially equal periodic payments
(made at least annually) for your life (or
life expectancy) or the joint lives (or joint
life expectancies) of you and your
designated beneficiary (if from an
employer plan, payments must begin
after separation from service).
03 Distributions due to total and permanent
disability.
04 Distributions due to death (does not
apply to modified endowment contracts).
05 Qualified retirement plan distributions up
to (1) the amount you paid for
unreimbursed medical expenses during
the year minus (2) 7.5% of your
adjusted gross income for the year.
06 Qualified retirement plan distributions
made to an alternate payee under a
qualified domestic relations order (does
not apply to IRAs).
07 IRA distributions made to unemployed
individuals for health insurance
premiums.
08 IRA distributions made for higher
education expenses.
09 IRA distributions made for purchase of a
first home, up to $10,000.
10 Distributions due to an IRS levy on the
qualified retirement plan.
11 Other (see Other, below). Also, enter
this code if more than one exception
applies.

Other. The following exceptions also
apply.
• Distributions incorrectly indicated as
early distributions by code 1, J, or S in
box 7 of Form 1099-R. Include on line 2
the amount you received when you
were age 591/2 or older.
• Distributions from a section 457 plan,
which are not from a rollover from a
qualified retirement plan.
• Distributions from a plan maintained
by an employer if:
1. You separated from service by
March 1, 1986;
2. As of March 1, 1986, your entire
interest was in pay status under a
written election that provides a specific
schedule for distribution of your entire
interest; and
3. The distribution is actually being
made under the written election.
• Distributions that are dividends paid
with respect to stock described in
section 404(k).
• Distributions from annuity contracts
to the extent that the distributions are
allocable to the investment in the
contract before August 14, 1982.
For additional exceptions that apply
to annuities, see Pub. 575.

Line 4
If any amount on line 3 was a
distribution from a SIMPLE IRA
received within 2 years from the date
you first participated in the SIMPLE IRA
plan, you must multiply that amount by
25% instead of 10%. These
distributions are included in boxes 1
and 2a of Form 1099-R and are
designated with code S in box 7.

Part II—Additional Tax
on Certain Distributions
From Education
Accounts
Line 6
This tax does not apply to distributions
that are includible in income if:
• Due to the death or disability of the
beneficiary;
• Made on account of a tax-free
scholarship, allowance, or payment
described in section 25A(g)(2);
• Made because of attendance by the
beneficiary at a U.S. military academy.
This exception applies only to the
extent that the distribution does not
exceed the costs of advanced
education (as defined in title 10 of the
U.S. Code) at the academy; or
• Included in income because you
used the qualified education expenses
to figure the Hope and lifetime learning
credit.
Enter on line 6 the portion of line 5
that is excluded.

your contribution limit is generally
$4,000 ($4,500 if age 50 or older at the
end of 2005) and your spouse’s
contribution limit is $4,000 ($4,500 if
age 50 or older at the end of 2005). But
if the combined taxable compensation
for you and your spouse is less than
$8,000 ($8,500 if one spouse is 50 or
older at the end of 2005; $9,000 if both
spouses are 50 or older at the end of
2005), see How Much Can Be
Contributed? in Pub. 590 for special
rules.
Also include on line 9a or 9b of the
IRA Deduction Worksheet in the
instructions for Form 1040, line 32, the
smaller of (a) Form 5329, line 10, or (b)
the excess, if any, of Form 5329, line 9,
over the sum of Form 5329, lines 11
and 12.

Line 11
Enter on line 11 any withdrawals from
your traditional IRAs that are included
in your income. Do not include any
withdrawn contributions reported on
line 12.

Line 12

Enter the amount from line 16 of your
2004 Form 5329 only if the amount on
line 17 of your 2004 Form 5329 is more
than zero.

Enter any excess contributions to your
traditional IRAs for 1976 through 2003
that you had returned to you in 2005
and any 2004 excess contributions that
you had returned to you in 2005 after
the due date (including extensions) of
your 2004 income tax return, that are
included on line 9, if:
• You did not claim a deduction for the
excess contributions and no traditional
IRA deduction was allowable (without
regard to the modified AGI limitation)
for the excess contributions, and
• The total contributions to your
traditional IRAs for the tax year for
which the excess contributions were
made were not more than: (a) $3,000
for years after 2001 and before 2005
($3,500 if age 50 or older at the end of
the year), (b) $2,000 for years after
1996 and before 2002, or (c) $2,250 for
years before 1997. If the total
contributions for the year included
employer contributions to a SEP,
increase that amount by the smaller of
the amount of the employer
contributions or $40,000 ($35,000 for
2001, or $30,000 for years before
2001).

Line 10

Line 15

If you contributed less to your
traditional IRAs for 2005 than your
contribution limit for traditional IRAs,
enter the difference.
If you are not married filing jointly,
your contribution limit for traditional
IRAs is the smaller of your taxable
compensation (see page 1) or $4,000
($4,500 if age 50 or older at the end of
2005). If you are married filing jointly,

Enter the excess of your contributions
to traditional IRAs for 2005 (unless
withdrawn — see below) over your
contribution limit for traditional IRAs.
See the instructions for line 10 to figure
your contribution limit for traditional
IRAs. Any amount you contribute for
the year in which you reach age 701/2 or
a later year is an excess contribution
because your contribution limit is zero.

Part III—Additional Tax
on Excess Contributions
to Traditional IRAs
If you contributed more for 2005 than is
allowable or you had an amount on line
17 of your 2004 Form 5329, you may
owe this tax. But you may be able to
avoid the tax on any 2005 excess
contributions (see the instructions for
line 15).

Line 9

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Do not include rollovers in figuring your
excess contributions.
You can withdraw some or all of your
excess contributions for 2005 and they
will not be treated as having been
contributed if:
• You make the withdrawal by the due
date, including extensions, of your 2005
tax return,
• You do not claim a traditional IRA
deduction for the withdrawn
contributions, and
• You withdraw any earnings on the
withdrawn contribution and include the
earnings in gross income (see the
Instructions for Form 8606 for details).
Also, if you had not reached age 591/2
at the time of the withdrawal, include
the earnings as an early distribution on
line 1 of Form 5329 for the year in
which you report the earnings.
If you timely filed your return without
withdrawing the excess contributions,
you can still make the withdrawal no
later than 6 months after the due date
of your tax return, excluding extensions.
If you do, file an amended return with
“Filed pursuant to section 301.9100-2”
written at the top. Report any related
earnings for 2005 on the amended
return and include an explanation of the
withdrawal. Make any other necessary
changes on the amended return (for
example, if you reported the
contributions as excess contributions
on your original return, include an
amended Form 5329 reflecting that the
withdrawn contributions are no longer
treated as having been contributed).

Part IV—Additional Tax
on Excess Contributions
to Roth IRAs
If you contributed more to your Roth
IRA for 2005 than is allowable or you
had an amount on line 25 of your 2004
Form 5329, you may owe this tax. But
you may be able to avoid the tax on
any 2005 excess contributions (see the
instructions for line 23).

Line 18
Enter the amount from line 24 of your
2004 Form 5329 only if the amount on
line 25 of your 2004 Form 5329 is more
than zero.

Line 19
If you contributed less to your Roth
IRAs for 2005 than your contribution
limit for Roth IRAs, enter the difference.
Your contribution limit for Roth IRAs is
generally your contribution limit for
traditional IRAs (see the instructions for
line 10) reduced by the amount you
contributed to traditional IRAs. But your
contribution limit for Roth IRAs may be
further reduced or eliminated if your

modified AGI for Roth IRA purposes is
over:
• $150,000 if married filing jointly or
qualifying widow(er),
• $0 if married filing separately and you
lived with your spouse at any time in
2005, or
• $95,000 for any other taxpayer.
See Pub. 590 for details.

Line 20
Generally, enter the amount from Form
8606, line 19, plus any qualified
distributions. But if you withdrew the
entire balance of all your Roth IRAs, do
not enter less than the amount on Form
5329, line 18 (see Example).
Example. You contributed $1,000 to
a Roth IRA in 2003, your only
contribution to Roth IRAs. In 2005, you
discovered you were not eligible to
contribute to a Roth IRA in 2003. On
September 9, 2005, you withdrew $800,
the entire balance in the Roth IRA. You
must file Form 5329 for 2003 and 2004
to pay the additional taxes for those
years. When you complete Form 5329
for 2005, you enter $1,000 (not $800)
on line 20, because you withdrew the
entire balance.

written at the top. Report any related
earnings for 2005 on the amended
return and include an explanation of the
withdrawal. Make any other necessary
changes on the amended return (for
example, if you reported the
contributions as excess contributions
on your original return, include an
amended Form 5329 reflecting that the
withdrawn contributions are no longer
treated as having been contributed).

Part V—Additional Tax
on Excess Contributions
to Coverdell ESAs
If the contributions to your Coverdell
ESAs for 2005 were more than is
allowable or you had an amount on line
33 of your 2004 Form 5329, you may
owe this tax. But you may be able to
avoid the tax on any 2005 excess
contributions (see the instructions for
line 31).

Line 26
Enter the amount from line 32 of your
2004 Form 5329 only if the amount on
line 33 of your 2004 Form 5329 is more
than zero.

Line 23

Line 27

Enter the excess of your contributions
to Roth IRAs for 2005 (unless
withdrawn — see below) over your
contribution limit for Roth IRAs (see the
instructions for line 19).
Any amounts converted to a Roth
IRA are excess Roth IRA contributions
if your modified AGI for Roth IRA
purposes is over $100,000 or your filing
status is married filing separately and
you lived with your spouse at any time
in 2005. See Recharacterizations in the
Instructions for Form 8606 for details.
Do not include rollovers in figuring your
excess contributions.
You can withdraw some or all of your
excess contributions for 2005 and they
will not be treated as having been
contributed if:
• You make the withdrawal by the due
date, including extensions, of your 2005
tax return, and
• You withdraw any earnings on the
withdrawn contributions and include the
earnings in gross income (see the
Instructions for Form 8606 for details).
Also, if you had not reached age 591/2
at the time of the withdrawal, include
the earnings as an early distribution on
line 1 of Form 5329 for the year in
which you report the earnings.
If you timely filed your return without
withdrawing the excess contributions,
you can still make the withdrawal no
later than 6 months after the due date
of your tax return, excluding extensions.
If you do, file an amended return with
“Filed pursuant to section 301.9100-2”

Enter the excess, if any, of the
maximum amount that can be
contributed to your Coverdell ESAs for
2005 (see the instructions for line 31)
over the amount actually contributed for
2005.

-4-

Line 28
Enter your total distributions from
Coverdell ESAs in 2005. Do not include
rollovers or returned excess
contributions.

Line 31
Enter the excess of the contributions to
your Coverdell ESAs for 2005 (not
including rollovers) over your
contribution limit for Coverdell ESAs.
Your contribution limit is the smaller of
$2,000 or the sum of the maximum
amounts allowed to be contributed by
the contributor(s) to your Coverdell
ESAs. The maximum contribution may
be limited based on the contributor’s
modified AGI. See Pub. 970 for details.
You can withdraw some or all of the
excess contributions for 2005 and they
will not be treated as having been
contributed if:
• You make the withdrawal before
June 1, 2006, and
• You also withdraw any income
earned on the withdrawn contributions
and include the earnings in gross
income for the year in which the
contribution was made.
If you filed your return without
withdrawing the excess contributions,

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Instructions for Form 5329

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you can still make the withdrawal, but it
must be made before June 1, 2006. If
you do, file an amended return. Report
any related earnings for 2005 on the
amended return and include an
explanation of the withdrawal. Make
any other necessary changes on the
amended return (for example, if you
reported the contributions as excess
contributions on your original return,
include an amended Form 5329
reflecting that the withdrawn
contributions are no longer treated as
having been contributed).

If you timely filed your return without
withdrawing the excess contributions,
you can still make the withdrawal no
later than 6 months after the due date
of your tax return, excluding extensions.
If you do, file an amended return with
“Filed pursuant to section 301.9100-2”
written at the top. Report any related
earnings for 2005 on the amended
return and include an explanation of the
withdrawal. Make any other necessary
changes on the amended return (for
example, if you reported the
contributions as excess contributions
on your original return, include an
amended Form 5329 reflecting that the
withdrawn contributions are no longer
treated as having been contributed).

If you timely filed your return without
withdrawing the excess contributions,
you can still make the withdrawal no
later than 6 months after the due date
of your tax return, excluding extensions.
If you do, file an amended return with
“Filed pursuant to section 301.9100-2”
written at the top. Report any related
earnings for 2005 on the amended
return and include an explanation of the
withdrawal. Make any other necessary
changes on the amended return (for
example, if you reported the
contributions as excess contributions
on your original return, include an
amended Form 5329 reflecting that the
withdrawn contributions are no longer
treated as having been contributed).

Part VII—Additional Tax
on Excess Contributions
to Health Savings
Accounts (HSAs)

Part VIII—Additional Tax
on Excess Accumulation
in Qualified Retirement
Plans (Including IRAs)

Enter the amount from line 40 of your
2004 Form 5329 only if the amount on
line 41 of your 2004 Form 5329 is more
than zero.

If you, someone on your behalf, or your
employer contributed more to your
HSAs for 2005 than is allowable or you
had an amount on line 43 of your 2004
Form 5329, you may owe this tax. But
you may be able to avoid the tax on
any 2005 excess contributions (see the
instructions for line 47).

Line 35

Line 43

You owe this tax if you do not receive
the minimum required distribution from
your qualified retirement plan, including
an IRA or an eligible section 457
deferred compensation plan. The
additional tax is 50% of the excess
accumulation — the difference between
the amount that was required to be
distributed and the amount that was
actually distributed.

If your contribution limit for your Archer
MSAs (the smaller of line 5 or line 6 of
Form 8853) is greater than the
contributions to your Archer MSAs for
2005, enter the difference on line 35.
Also include on your 2005 Form 8853,
line 7, the smaller of:
• Form 5329, line 35, or
• The excess, if any, of Form 5329,
line 34, over Form 5329, line 36.

If your contribution limit for your HSAs
(Form 8889, line 10) is greater than the
contributions you made to your HSAs
(or those made on your behalf) for 2005
(Form 8889, line 2), enter the difference
on line 43. Also include on your 2005
Form 8889, line 11, the smaller of:
• Form 5329, line 43, or
• The excess, if any, of Form 5329,
line 42, over Form 5329, line 44.

Part VI—Additional Tax
on Excess Contributions
to Archer MSAs
If you or your employer contributed
more to your Archer MSA for 2005 than
is allowable or you had an amount on
line 41 of your 2004 Form 5329, you
may owe this tax. But you may be able
to avoid the tax on any 2005 excess
contributions (see the instructions for
line 39).

Line 34

Line 39

Line 47

Enter the excess of your contributions
to your Archer MSA for 2005 (from
Form 8853, line 4) over your
contribution limit (the smaller of line 5 or
line 6 of Form 8853). Also include on
line 39 any excess contributions your
employer made. See the Instructions
for Form 8853 for details.
However, you can withdraw some or
all of the excess contributions for 2005
and they will not be treated as having
been contributed if:
• You make the withdrawal by the due
date, including extensions, of your 2005
tax return, and
• You withdraw any income earned on
the withdrawn contributions and include
the earnings in gross income for the
year in which you receive the withdrawn
contributions and earnings.
Include the withdrawn contributions
and related earnings on Form 8853,
lines 8a and 8b.

Enter the excess of your contributions
(including those made on your behalf)
to your HSAs for 2005 (Form 8889, line
2) over your contribution limit (Form
8889, line 10). Also include on line 47
any excess contributions your employer
made. See the instructions for Form
8889 for details.
However, you can withdraw some or
all of the excess contributions for 2005
and they will not be treated as having
been contributed if:
• You make the withdrawal by the due
date, including extensions, of your 2005
return, and
• You withdraw any income earned on
the withdrawn contributions and include
the earnings in gross income for the
year in which you receive the withdrawn
contributions and earnings.
Include the withdrawn contributions
and related earnings on Form 8889,
lines 12a and 12b.

-5-

Required Distributions
IRA (other than a Roth IRA). You
must start receiving distributions from
your IRA by April 1 of the year following
the year in which you reach age 701/2.
At that time, you can receive your entire
interest in the IRA or begin receiving
periodic distributions. If you choose to
receive periodic distributions, you must
receive a minimum required distribution
each year. You can figure the minimum
required distribution by dividing the
account balance of your IRAs (other
than Roth IRAs) on December 31 of the
year preceding the distribution by the
applicable life expectancy. For
applicable life expectancies, see Pub.
590.
If the trustee, custodian, or issuer of
your IRA informs you of the minimum
required distribution, you can use that
amount.
If you have more than one IRA, you
can take the minimum required
distribution from any one or more of the
individual IRAs.
For more details on the minimum
distribution rules (including examples),
see Pub. 590.
Roth IRA. There are no minimum
required distributions during the lifetime
of the owner of a Roth IRA. Following
the death of the Roth IRA owner,

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Instructions for Form 5329

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required distribution rules apply to the
beneficiary. See Pub. 590 for details.
Qualified retirement plans (other
than IRAs) and eligible section 457
deferred compensation plans. In
general, you must begin receiving
distributions from your plan no later
than April 1 following the later of (a) the
year in which you reach age 701/2 or (b)
the year in which you retire.
Exception. If you owned more than
5% of the employer maintaining the
plan, you must begin receiving
distributions no later than April 1 of the
year following the year in which you
reach age 701/2, regardless of when you
retire.
Your plan administrator should figure
the amount that must be distributed
each year.
Note. The IRS can waive this tax if you
can show that any shortfall in the

amount of withdrawals was due to
reasonable error and you are taking
appropriate steps to remedy the
shortfall. If you believe you qualify for
this relief, file Form 5329 and attach a
letter of explanation.
For more details, see Pub. 575.
Paperwork Reduction Act Notice.
We ask for the information on this form
to carry out the Internal Revenue laws
of the United States. You are required
to give us the information. We need it to
ensure that you are complying with
these laws and to allow us to figure and
collect the right amount of tax.
You are not required to provide the
information requested on a form that is
subject to the Paperwork Reduction Act
unless the form displays a valid OMB

-6-

control number. Books or records
relating to a form or its instructions
must be retained as long as their
contents may become material in the
administration of any Internal Revenue
law. Generally, tax returns and return
information are confidential, as required
by section 6103.
The average time and expenses
required to complete and file this form
will vary depending on individual
circumstances. For the estimated
averages, see the instructions for your
income tax return.
If you have suggestions for making
this form simpler, we would be happy to
hear from you. See the instructions for
your income tax return.