The IRS recently updated Instructions for Form 1099-R/5498 for tax year 2025. Form 1099-R is used to report distributions of $10 or more from retirement plans, IRAs, annuities, pensions, insurance contracts, disability payments, and charitable gift annuities. Form 5498 is used to report information about Individual Retirement Arrangements (IRAs) maintained for a person, including contributions, rollovers, and fair market values.
Updates affecting both forms
The updated instructions provide comprehensive descriptions of IRA types for both forms:
- Simplified Employee Pension (SEP) plans, which permit both employer contributions and individual supplemental contributions to the same accounts
- Savings Incentive Match Plan for Employees (SIMPLE) plans, which maintain distinctive restrictions, including prohibiting individual contributions and specialized requirements during initial participation periods
The instructions define Traditional IRAs to include SEP and SIMPLE IRAs, while Roth IRAs include their corresponding SEP Roth and SIMPLE Roth variants.
Contribution limits have also increased for 2025, with the regular IRA contribution limit rising to $7,000 and the limit for participants who are 50 or older to $8,000. Additional modifications address detailed reporting requirements and conditions for rollover distributions.
Form 1099-R Instructions
The most notable change in the instructions for Form 1099-R is the addition of a new code: Y. This code will identify qualified charitable distributions (QCD) and must be used along with other codes based on the distribution type:
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Code 7 for normal distributions
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Code 4 for inherited accounts
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Code K for assets without readily available fair market value
Form 5498 Instructions
The due date for Form 5498 has been updated to June 1, 2026, and the participant statement deadline has been updated to Feb. 2, 2026 to account for the original due date being on a weekend.
To review Form 1099-R/5498 Instructions in greater detail, click here.
