IRS Publication 590 for individual retirement arrangements (IRAs) refers to an Internal Revenue Service (IRS) document that outlines and elaborates on rules for IRAs. The IRS publishes Form 590 to provide information about setting up IRAs, how to contribute to them, how much may be contributed, how to treat distributions, and how to take tax deductions for contributions made to IRAs.
IRS Publication 590 also provides information on penalties that taxpayers might face if IRA regulations are not followed properly.
What is included in IRS Publication 590
A change in recent years is that Publication 590 has been broken into two parts. Part A covers contributions to individual retirement arrangements (IRAs), and Part B covers distributions from individual retirement arrangements (IRAs).
Some of the information the publication explains, includes:
- Who can open an IRA and when they can be opened, and how
- IRA definitions
- How much may be contributed
- When contributions can be made
- How much may be deducted
- IRA inheritance rules
- Moving retirement assets
- Asset withdrawal rules
- Acts that trigger penalties or additional taxes
Updates to IRS Publication 590: Part A
Publication 590-A (Cat. No. 66302J) includes information about contributions to traditional IRAs, Roth IRAs, SIMPLE IRAs, and Simplified Employee Pension (SEP) IRAs. It explains the rules for setting up an IRA; contributing to an IRA; transferring money or property to and from an IRA; and taking a credit for contributions to an IRA. It also explains the penalties and additional taxes that apply when the rules aren’t followed.
Updates to IRS Publication 590: Part B
Publication 590-B (Cat. No. 66303U) discusses traditional and Roth IRAs. It explains the rules for handling an inherited IRA, and receiving distributions (making withdrawals) from an IRA. It also explains the penalties and additional taxes that apply when the rules aren’t followed.
If you are an IRA owner, including a self-directed IRA owner, IRS Publication 590 Parts A and B are important to be familiar with. They are used by CPAs and other tax preparers when filing federal income tax returns, and they can also answer many questions you may have about how the IRS views these accounts.
For more detailed information about the changes listed here, you can download Publication 590-A (Cat. No. 66302J) and Publication 590-B (Cat. No. 66303U) at these links or visit www.irs.gov.
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