Common use of Failure to Remove Before the Deadline Clause in Contracts

Failure to Remove Before the Deadline. Excess Xxxxxxxxx ESA contributions that are not removed before June 1 of the year following the year for which the excess was made, are treated as contributions for the next calendar year. If, however, additional contributions are made for that year and the total amount results in an excess, the excess amount will be subject to a six percent penalty tax if not removed timely. If additional contributions have been made for the next year, the amount of the excess equals the excess contribution for the current year, plus the excess contributions remaining from the preceding year, reduced by any distributions made during the current year. The designated beneficiary must file IRS form 5329 to report and remit any additional penalty taxes to the IRS.

Failure to Remove Before the Deadline. Excess Xxxxxxxxx ESA contributions that are not removed before June 1 of the year following the year for which the excess was made, are treated as contributions contribution for the next calendar year. If, however, additional contributions are made for that year and the total amount results in an excess, the excess amount will be subject to a six percent penalty tax if not removed timely. If additional contributions have been made for the next year, the amount of the excess equals the excess contribution for the current year, plus the excess contributions remaining from for the preceding year, reduced by any distributions made during the current year. The designated beneficiary Designated Beneficiary must file IRS form 5329 to report and remit any additional penalty taxes to the IRS.