5498 Tax Reporting Frequently Asked Questions (FAQs) for Fully-Administered Program Clients

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1 5498 Tax Reporting Frequently Asked Questions (FAQs) for Fully-Administered Program Clients Below are common questions and answers regarding 2017 tax reporting for the IRS Form 5498 series. Q. When is the tax return deadline? A. Because the normal April 15 deadline falls on a Sunday and Emancipation Day is observed the following business day, the 2017 tax return deadline is April 17, Q. What are my reporting options? A. Your selected reporting option is the method you use to provide Ascensus with tax reporting information for tax year Take the steps below to confirm your reporting options. 1. Click your financial organization s name in the upper right corner of the IRAdirect homepage. 2. Click the Reporting tab. 3. Review the elections for 5498, 5498-ESA, and 5498-SA reporting listed in the Reporting Options column. Either Online or Transmission will be listed for each reporting type. If you report 5498, 5498-ESA, or 5498-SA information using the Transmission option, also review the Contributions Applied from File to IRAdirect section, which indicates if your organization is currently set up to have all contributions or only regular contributions applied to IRAdirect from your submitted 5498 file. If only regular contributions are read from your organization s 5498 file, then only regular, SEP, and SIMPLE IRA contributions will be applied from your file and any rollover, recharacterization, and Roth IRA conversion contributions will only be reported if your organization adds those contribution types to an account owner s tree in IRAdirect. If only regular contributions are read from your organization s 5498-ESA file, then any rollover or direct transfer contributions will only be reported if your organization adds those contribution types to an account owner s tree in IRAdirect. If changes need to be made to the current settings, an Advanced User may do so on April 18, 2018, or later, under the Upload Tax Files link before submitting your organization s 5498 file. NOTE: For 5498-SA files, Ascensus will always read all contribution types listed in your file. This setting cannot be changed. Q. What do the reporting options mean? If the reporting option is Online, what is required? If I see Transmission for a reporting option, what should I do? A. The Online option means that your financial organization must complete the applicable report wizards in IRAdirect. As applicable, the following report wizard links will appear in the Reports and Queues section of the IRAdirect homepage. Confirm, enter, or change information in the report wizards and submit the entries by the applicable deadlines by following the instructions listed in the applicable report wizard. ESA Contribution Report Wizard (available April 18, 2018) IRA FMV and Contribution Report Wizard (available April 18, 2018) HSA FMV and Contribution Report Wizard (available April 18, 2018) 1

2 The Transmission option means that your IT department or external data processor must transmit a file to us with the applicable information. Beginning April 18, 2018, files should be uploaded through the Upload Tax Files link in the Tax Reporting section of the IRAdirect homepage. When submitting an ESA, IRA, or HSA FMV/contribution file under the Upload Tax Files link, you must confirm that you acknowledge and understand the specific contribution types that will be applied to IRAdirect from your submitted file by taking the following steps. 1. Click the FMVs/Contributions for IRAs (5498), ESAs (5498-ESA), and/or HSAs (5498-SA) radio button to submit an ESA, IRA, or HSA FMV/contribution file. 2. Click the View/Change Contribution Settings button to view the current contribution types that will be read from your file. 3. Read the instructions provided in the pop-up box to ensure you understand the contribution types that are read from your file, and make changes to the current settings, if necessary. (Changes cannot be made to the 5498-SA contribution settings.) 4. Click the Save button to save any changes made to your settings, or click Cancel to return to the Upload Tax Files page. 5. Check the box that indicates you confirm and understand that the contribution types selected under the View/Change Contribution Settings button will be applied to IRAdirect from your submitted file. (You cannot upload a tax file until this box is checked.) 6. Continue uploading your file by completing the remaining steps on the Upload Tax Files page. Q. If my reporting option is Transmission, what type of file do I send? A. All tax reporting files must be in IRS 750 Format with exactly 750 characters per row, no more or less. The requirements for IRS 750 Format are in IRS Publication 1220, available at Make sure the correct tax year is indicated in the file (tax year 2017), and that the file is not indicated as a test file (T record position 28 should not contain the letter T ). If your file includes an extension, we do not accept the following extensions:.pdf,.xls,.xlsx,.doc,.docx,.tif,.gif,.jpg,.bmp,.html,.exe,.pl,.php,.vbs,.asp,.js,.jsp,.bat, or.zip. We will also reject files with any of the following symbols in the extension: ( ; { } ) : - If your file is formatted incorrectly, or an error occurs that delays processing because manual intervention is required to apply the tax data, your organization may be charged a $100 Ascensus Processing Issue Fee. Follow the steps below to access information regarding the Ascensus transmission requirements. 1. Click the Upload Tax Files link in the Tax Reporting section of the IRAdirect homepage. 2. Click the Transmission Requirements for Clients link in the Learn More box in the upper right corner of the screen. Q. How do I know if you received my Transmission file? A. When you upload your Transmission file through the Upload Tax Files link, you can enter an address to receive a confirmation . After uploading your Transmission file, an immediate success message will appear if the file was successfully submitted. We will also send an to the address you provided to confirm that we received your file. It normally takes 72 hours to process your file. If any errors are discovered during this time, your organization will be notified by . 2

3 When your file is successfully processed, we will send a confirmation to your organization s Primary Contact in IRAdirect if that individual is registered to receive our notifications. The received and processed dates will also be listed under the Date Information Received and Date Information Processed columns of the Reporting tab in IRAdirect. Q. If our IRAdirect Primary Contact is not registered to receive notifications, how do we sign up for that service? A. Take the following steps. 1. Click your organization s name in the upper right corner of the IRAdirect homepage. 2. Click the Contacts tab. The screen will automatically display the listing for your organization s Primary Contact. 3. Enter a valid address in the Address field, or confirm that the listed address is correct. 4. Check the Send notifications to this contact box. 5. Click the Save button. If you notice that a representative set up to receive notifications is not receiving our communications, have your IT department whitelist our s. They ll need the following information to complete this task. Domain: ascensus-rps.com IP Address: Q. What are the deadlines for reporting 2017 tax information for Forms 5498-ESA, 5498, and 5498-SA to Ascensus? A. The tax reporting deadlines are outlined in the table below. Reporting Type Reporting Option Due Date 5498-ESA Transmission or Online April 20, Transmission or Online May 8, SA Transmission or Online May 8, 2018 Q. When will our tax forms be produced? A. The first tax form productions will occur before business hours as indicated below. Thereafter, tax forms will be produced before business hours every Tuesday, Thursday, and Friday morning. April 24, 2018 (IRS Forms 5498-ESA for all CID numbers) Because of the tight turnaround this year, only Forms 5498-ESA in this production run are guaranteed to meet the IRS deadline May 10, 2018 (IRS Forms 5498-SA for all CID numbers and Forms 5498 for CID numbers ) May 11, 2018 (Forms 5498 for CID numbers ) May 15, 2018 (Forms 5498 for CID numbers ) 3

4 Q. Can we send electronic tax forms to account owners? A. Yes, Ascensus offers etax forms for account owners. An Advanced User may select account owner tax form delivery preferences through IRAdirect by clicking the etax Owner Settings link in the Tax Reporting section of the IRAdirect homepage. Click the Need Help? link or the etax Forms User Guide link for more information about selecting etax forms delivery. Q. The IRS requires any IRA self-certified late rollovers to be reported for tax year If any of our organization s account owners complete a self-certified late rollover in 2017, how do we report these transactions? A. If your organization uses the Online reporting option, an Advanced User can add these transactions to an account owner s tree by taking the following steps. 1. Click the Acct link under the account owner s name in the owner tree. 2. Select the Create Contribution radio button under the For this Account section and click Continue. 3. Select Rollover from the Type drop-down menu, then check the Late Rollover certified by the owner box that appears. 4. Enter the correct values in the remaining fields and click Save. When the IRA FMV and Contribution Report Wizard becomes available on April 18, 2018, confirm that the correct value of the self-certified late rollover contribution appears for the account owner in the Self-Certified Late Rollover Cont Amount column. To make any changes, edit the amount that appears in the column s field. If your organization uses the Transmission reporting option, your IT department or data processor should follow the instructions in IRS Publication 1220, to properly report any self-certified late rollover contributions in your transmission file. As long as the transactions are coded correctly in your file, Ascensus will apply the transactions to the owner s account and subsequently report on Form If the proper coding was not used in your file, check your Tax Reporting Error Queue to correct the transaction, following the instructions provided in the Error Queue User Guide. Q. A red message on the IRAdirect homepage says that I have errors. What does this mean? A. These red messages alert you to problems that were encountered when your file was processed. This message may only appear for clients that submit tax information using the Transmission reporting option. The transactions for the account owners listed in the Tax Reporting Error Queue must be corrected before the applicable tax reporting can occur. When you see an error message, take these steps to access the Tax Reporting Error Queue. 1. Click the Tax Reporting Error Queue link in the Tax Reporting section of the IRAdirect homepage. 2. Correct the errors listed in the Error Queue by following the instructions listed in the Error Queue User Guide, which will be located in the upper left corner of the Error Queue screen. Q. When would we access the Tax Reporting Warnings link in the Tax Reporting section? A. If tax reporting information is submitted for your organization by transmitting a file (the Transmission reporting option), review the Tax Reporting Warnings link in the Tax Reporting section of the IRAdirect homepage. This queue displays certain transactions that have been applied to an account owner s account in IRAdirect, but should be reviewed by your organization for accuracy because a change was made before it was applied. Take the steps listed on the following page. 4

5 1. Click the Tax Reporting Warnings link in the Tax Reporting section of the IRAdirect homepage. 2. Follow the instructions listed on the page (or view the last page of the Error Queue User Guide for specific instructions). 3. Click the Delete button to delete a warning once it s reviewed for accurate reporting on the account owner s tree. Q. How do I make a correction if I notice an error on an account owner s tax form after 2017 tax information has been applied to IRAdirect (either through the online report wizards or from a transmission file), but before the tax form has been produced? A. Corrections can be made by an Advanced User on the account owner s tree in IRAdirect. Follow the applicable steps below based on whether you re correcting FMV or contribution information. Correcting FMVs before 5498s are produced 1. Search for the account owner in the upper left corner of the IRAdirect homepage. 2. Click the 12/31/2017 FMV Amt link under the account owner s account that needs to be corrected. 3. Enter the correct FMV amount in the 12/31/2017 FMV field under the Current Balances section and click the Save button. Correcting contribution information before 5498s are produced 1. Search for the account owner in the upper left corner of the IRAdirect homepage. 2. Click the RU-12/31/2017 Contribution link under the account owner s account that needs to be corrected. 3. Enter the corrected amounts in the applicable fields and click the Save button. If the contribution type on the existing RU-Contribution is incorrect, take the following steps. 1. Click the RU-12/31/2017 Contribution link under the account owner s account that needs to be corrected. 2. Enter 0.00 in all of the amount fields and click the Save button. 3. Add a new contribution to the account owner s tree using the correct contribution type. Q. How do I make a correction if I notice an error on an account owner s tax form after it has been produced? A. Each time tax forms are produced for your organization, an applicable Information Report will be available in IRAdirect. Each report documents the information on the tax forms produced in that run, and is accompanied by report instructions. You should review the report, and if corrections are needed for an owner s tax form, enter the changes in IRAdirect as outlined in the report instructions. A corrected tax form will be produced for the owner in the next tax form production run, and it will be documented in the subsequent Information Report. To access the information reports and instructions, take the steps listed below. 1. Click the Reports link in the Reports and Queues section of the IRAdirect homepage. 2. Click the applicable report you wish to view. Current Tax Year 5498 Information Report Current Tax Year 5498-ESA Information Report Current Tax Year 5498-SA Information Report 5

6 Q. How can I see the information reported on each tax form produced for our financial organization? A. Each time we produce original or corrected tax forms for your organization, the applicable Information Report will be available in IRAdirect following that run through the Reports link on the homepage. Follow the steps listed in the preceding question to pull an applicable Information Report. Q. How can I confirm that tax forms were produced? A. If you submitted the information by our deadline, your forms will be produced in the first production of forms for that type. (Refer to the information on page 3.) After that production date, take these steps to confirm that your forms were produced. 1. Click your organization s name in the upper right corner of the IRAdirect homepage. 2. Click the Summary tab. 3. Navigate to the 2017 Tax Forms Produced section. If you see a figure greater than zero in the Paper or Electronic columns for the specific form type, then those tax form types have been produced. To view the number of tax forms produced on a specific date, take the following steps. 1. Click the Reports link in the Reports and Queues section of the IRAdirect homepage. 2. Click the applicable Information Report for the tax form production dates you wish to view. 3. Select a specific date range from the Printed Date From and Printed Date To drop-down menus to view the number of tax forms produced on those dates. 4. Click the Generate Report button to produce the report. The date the tax form was produced will be listed in the Account Type/Form Type/Date Produced column. Q. How do I determine the total numbers of each form type sent out to date? A. Follow the first set of steps listed in the preceding question. Q. If I have further questions regarding tax reporting, is there someone I can contact? A. Yes. Please contact our IRA Call Center at from 8:00 a.m. to 6:00 p.m. Central Time, Monday through Friday, for assistance with any tax reporting questions. Ascensus and the Ascensus logo are registered trademarks of Ascensus, LLC. IRAdirect is a registered trademark of Ascensus, LLC. Copyright 2018 Ascensus, LLC. All Rights Reserved. 6