A qualified retirement plan includes:
- A qualified pension, profit-sharing, or stock bonus plan (including a 401(k) plan),
- A tax-sheltered annuity contract,
- 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 on page 1). taxmap/instr2/i5329-004.htm#TXMP6815d256
Modified endowment contracts are not qualified retirement plans.
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.taxmap/instr2/i5329-004.htm#TXMP12a149f1
Generally, any distribution from your IRA, other qualified retirement plan, or modified endowment contract before you reach age 59 is an early distribution.taxmap/instr2/i5329-004.htm#TXMP09056fcc
Generally, 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.
Beginning in 2008, you can roll over (convert) amounts from a qualified retirement plan to a Roth IRA. Any amount rolled over to a Roth IRA is subject to the same rules for converting a traditional IRA to a Roth IRA. You must include in your gross income distributions from a qualified retirement plan that you would have had to include in income if you had not rolled them into a Roth IRA. Generally, the 10% tax on early distributions does not apply. For more information, see Rollover From Employer's Plan Into a Roth IRA in chapter 2 of Pub. 590.
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 for details.taxmap/instr2/i5329-004.htm#TXMP4b88cdca
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.
For IRAs, treat nontaxable combat pay and 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, or on Form 1040NR, line 27, but not by any loss from self-employment.