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confused about 2018 Form 5498

Actually, two questions.

My wife, who is retired, had a 401K with a company that she worked for. That company declared bankruptcy last year.

We got nervous about that, so we moved the funds directly into an IRA with the same custodian, Wells Fargo (WF).

A few months later, we moved the funds - direct transfer -- into a newly created IRA with another firm.

So, question #1: Am I correct that she could do this (effectively two direct transfers: 401K to IRA to IRA) with no problem?

Now, today I got the 5498 form from WF.It only had one non-zero figure, and that was Box 2, Rollover Contributions. That would be the amount from the WF 401K to the WF IRA.So:

Question #2: I assume that for me this is just informational (although it goes to the IRS) and I just keep it but don't have to do anything with it. Correct?

Mel

Reply to
MZB
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If by direct transfer you mean a trustee-to-trustee transfer or a transfer that involved a check, but the check was made out to the receiving trustee and NOT to you (even if mailed to you), then you're fine. The once-per-year transfer limit only applies if you personally take control of the money.

And yes, in your situation I would expect only the one non-zero number since the second transfer didn't add money to or remove money from the IRA "universe" (for most tax purposes all your IRA accounts are really a single IRA).

Finally, there's nothing to do with the 5498 (which as you suspect does also go to the IRS) other than keep it for your record.

Reply to
Rich

Thanks. Yes, it was trustee to trustee.

Mel

Reply to
MZB

IIRC, the 5498 is only used to calculate MRD (Minimum Required Distribution). You don't need to worry about it for a personal (as opposed to inherited) IRA until the year in which you reach age 70 1/2.

Reply to
Arthur Rubin

Reply to
lotax

The 5498 tells the IRS more than just whether an MRD is due and the amount from that account. It tells the IRS if any contributions were made to an IRA, a SIMPLE IRA or a Roth IRA for the tax year. It also tells the IRS the amounts of any rollovers or conversions in that tax year. As such, the taxpayer should confirm that the numbers in all those boxes match their actual activity with the trustee.

Reply to
Alan

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