Tax season is upon us once again, and as we start accumulating the various forms and documents filling our mailboxes, the process of tax preparation begins.  

While it can be daunting, each tax document you receive from income sources, investments, or business entities provides a piece of the puzzle to complete the full picture of your income. We have compiled helpful information on the three most common forms you might receive to help you navigate with ease.  

Navigating Tax Prep Forms 

Let’s take a closer look at some of the most common tax forms relevant to you and why you might receive them. 

Form 5498 

Form 5498 details contributions made to an IRA or Roth IRA over the prior year.  

That includes direct cash contributions, rollover contributions (which are generally not taxable), Roth conversion activity, and recharacterized contributions. Additionally, it provides basic information such as the market value of the IRA or Roth IRA at the start of the new calendar year.  

One important note: this form is generally for informational purposes only and is not required for tax filing. 

Form 1099 

Form 1099 is the most common tax form for reporting “non-wage” income.  

There are multiple variations, each designated by a different suffix (e.g., 1099-B, 1099-DIV, 1099-INT, 1099-NEC). Fortunately, our primary custodian, Raymond James, compiles all applicable 1099 forms into a Consolidated 1099, which you will receive if you own a taxable brokerage account (non-IRA). This document reports dividends, interest, capital gains/losses, and other taxable events from the prior year. 

One important note: The Consolidated 1099 for your taxable investment account at Master’s is typically one of the last tax forms you will receive, often arriving in March, whereas most other tax forms are issued in late January or February. 

Form 1099-R 

For retired clients, Form 1099-R is the most common version of the 1099 forms.  

You will receive this form if you had taxable or charitable distributions from an IRA, annuity, or pension. It reports both the taxable income amount and any tax withholding you elected. 

Here are two specific planning strategies that will generate a 1099-R aside from a traditional IRA: 

• Roth IRA Conversions: Converting pre-tax money from a traditional IRA to a Roth IRA is a taxable event and must be reported on your tax return. This will be reflected on Form 1099-R. 

• Qualified Charitable Distributions (QCDs): Even though QCDs are exempt from federal income tax, they are still reported on Form 1099-R. You will need to provide your tax preparer with gift receipt letters from the charities you donated to from your IRA to confirm the distributions were charitable rather than taxable. 

Important Transition Information for 2024 

Last year was a major transition year for Master’s, as we moved from Securities America (now “Osaic”) to Raymond James Custodial Services in 2024.  

As a result, you will receive tax documents from Osaic for any taxable activity before April 2024 and tax documents from Raymond James for any activity after the transition. 

Both Raymond James and Osaic will send tax forms via U.S. Mail unless you have elected electronic delivery for them.  

Need Help? We’re Here for You! 

Tax season can be overwhelming, and ensuring you have all necessary forms can be confusing. While we do not provide tax advice, we can certainly help answer your questions as you gather the required tax forms for your accounts with us. Our team is happy to assist with any inquiries you may have! Please, feel free to contact us today.