Common use of Qualified Health Savings Account (HSA) Funding Distribution Clause in Contracts

Qualified Health Savings Account (HSA) Funding Distribution. If you are an HSA eligible individual, you may be eligible to do a tax-free transfer of IRA assets to your HSA. This transfer, which is referred to as a qualified HSA funding distribution, is subject to HSA contribution limits. You must irrevocably elect to treat such distribution as a qualified HSA funding distribution. Generally, you are limited to one qualified HSA funding distribution from any of your Traditional or Xxxx IRAs during your lifetime. For assistance in determining to what extent you may be eligible to make a qualified HSA funding distribution, consult your tax advisor. DISTRIBUTIONS TO YOUR BENEFICIARIES WHEN YOU DIE Any amounts remaining in your IRA at your death will be paid to your beneficiary(ies). When you die, the rules determining the distribution of your IRA balance depend on a number of factors. These include whether you had a "designated beneficiary," your relationship to the beneficiary (spouse or nonspouse) and whether you died before or after RMDs were required to begin. Designated Beneficiary. A "designated beneficiary" is determined based on the beneficiary(ies) designated as of the date of your death and who remains your beneficiary(ies) on September 30th of the calendar year following the calendar year of your death. If You Die Before RMDs Are Required To Begin. Generally, if you die before April 1 following the year you reach age 70½ and your designated beneficiary(ies) is an individual, he or she may elect a distribution method. Your beneficiary(ies) may elect to deplete the IRA by the end of the fifth calendar year following your death or to receive payments based on the designated beneficiary(ies)’s life expectancy. If life expectancy payments are elected, the payments must begin by December 31 of the first calendar year following your death. However, if your surviving spouse is your sole designated beneficiary, he or she may delay the first distribution until December 31 of the year you would have attained age 70½ if later. If your designated beneficiary is not an individual or a qualified trust (e.g., a charity, your estate, etc.), your IRA must be distributed by the end of the fifth calendar year following your death. Generally, each beneficiary may elect the timing and manner regarding the distribution of his or her portion of the IRA. Elections must generally be made by December 31 of the year following your death. If timely elections are not made, your beneficiary is required to take distributions according to the applicable default provision. The default distribution option for designated beneficiaries who are individuals is the life expectancy option and the default distribution option for designated beneficiaries that are not individuals is the 5-year method. If your beneficiary(ies) does not withdraw the required amount within the prescribed time frame, he or she may be subject to the 50% excess accumulation penalty tax on the amount that should have been withdrawn but was not distributed. If your surviving spouse is the sole designated beneficiary of your IRA, he or she may treat your IRA as his or her own IRA by redesignating your IRA as his or her own IRA, failing to take a required distribution as a beneficiary, or by making a contribution. Regardless of whether your spouse is the sole designated beneficiary, he or she may roll distributions from your IRA into his or her own IRA generally within 60 days of receipt. Additional restrictions may apply. If You Die On or After RMDs Are Required to Begin. If you die on or after April 1 following the year you attain age 70½, the designated beneficiary(ies) must continue taking distributions from your IRA. The longest time frame for receiving payouts is over the remaining life expectancy of the applicable designated beneficiary or based on your remaining life expectancy factor, had you not died, whichever period is longer. Distributions must commence by December 31 of the calendar year following your death. If your designated beneficiary is not an individual or a qualified trust (e.g., a charity, your estate, etc.), your IRA must be distributed using your single life expectancy (had you not died) reduced by one each year. Your beneficiary(ies) must withdraw your RMD for the year of your death, if you do not withdraw it before your death. If your surviving spouse is the sole designated beneficiary of your IRA, he or she may treat your IRA as his or her own IRA by redesignating your IRA as his or her own IRA, failing to take a required distribution as a beneficiary, or by making a contribution. Regardless of whether your spouse is the sole designated beneficiary, he or she may roll distributions from your IRA into his or her own IRA generally within 60 days of receipt. Additional restrictions may apply. TAX WITHHOLDING Distributions from your IRA, except certain transfers or any recharacterization, are subject to 10% federal income tax withholding. You may elect in writing not to have withholding apply to your IRA distribution in most cases. If you elect not to have withholding applied, or if you do not have enough federal income tax withheld from your IRA distribution, you may be responsible for payment of estimated tax. You may be subject to penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. In addition to federal income tax withholding, distributions from IRAs may also be subject to state income tax withholding. CORRECTION OF EXCESS CONTRIBUTIONS Any amount you contribute for a tax year that exceeds the allowable contribution amount is an excess contribution and subject to a 6% penalty tax each year it remains in the IRA. You may avoid the penalty tax if you remove the excess contribution along with the net income attributable to the excess before your tax return due date, plus extensions. For assistance in calculating the net income attributable to an excess contribution using an IRS-approved method, refer to Treasury Regulation 1.408-11, IRS Pub. 590-A and your tax advisor. The net income must be included in your taxable income. If you are under age 59½ and do not qualify for an exception, the net income is also subject to the IRS 10% premature distribution penalty. File IRS Form 5329 to pay any penalty taxes. To correct an excess contribution after your tax filing due date (plus extensions), you may withdraw the excess amount (no earnings need to be withdrawn.) Alternatively, if you are eligible to contribute in a subsequent year, you may correct the excess amount by redesignating the amount to a subsequent year. To redesignate a contribution, you under contribute in a subsequent year and claim the original contribution amount when you file your income taxes for that subsequent year. The original amount is either deducted on Form 1040 or claimed as a nondeductible contribution on Form 8606. Regardless of which method you use to correct the excess after your tax return due date, plus extensions, the 6% penalty is required for each year it remained in the IRA.

Qualified Health Savings Account (HSA) Funding Distribution. If you are an HSA eligible individual, you may be eligible to do a tax-free transfer of IRA assets to your HSA. This transfer, which is referred to as a qualified HSA funding distribution, is subject to HSA contribution limits. You must irrevocably elect to treat such distribution as a qualified HSA funding distribution. Generally, you are limited to one qualified HSA funding distribution from any of your Traditional or Xxxx IRAs during your lifetime. For assistance in determining to what extent you may be eligible to make a qualified HSA funding distribution, consult your tax advisor. advisor DISTRIBUTIONS TO YOUR BENEFICIARIES WHEN YOU DIE Any amounts remaining in your IRA Xxxx XXX at your death will be paid to your beneficiary(ies). When you die, Distributions to your beneficiary(ies) within the rules determining the 5-year qualified distribution holding period may be taxed as ordinary income. The 10% penalty tax for premature distributions does not apply to distributions to your beneficiary(ies) after your death. The period of time over which your IRA Xxxx XXX balance depend may be distributed to your beneficiary(ies) depends on a number of factors. These include whether you had a "“designated beneficiary," ” and your relationship to the beneficiary (spouse or nonspouse) and whether you died before or after RMDs were required to begin. Designated Beneficiary). A "“designated beneficiary" ” is determined based on the beneficiary(ies) designated as of the date of your death and who remains remain(s) your beneficiary(ies) on September 30th of the calendar year following the calendar year of your death. If You Die Before RMDs Are Required To BeginFive-Year Holding Period. Generally, if you die before April 1 following Beneficiaries must ensure the five-year you reach age 70½ and your designated beneficiary(ies) is an individual, he or she may elect a distribution method. Your beneficiary(ies) may elect to deplete the IRA by the end of the fifth calendar year following your death or holding period has been satisfied to receive payments based on qualified distributions. The years you were alive are credited toward the designated beneficiary(ies)’s life expectancyfive-year waiting period. If life expectancy payments are electedThat is, the payments must begin by December 31 five-year waiting period is not “re-set” upon your death. The period begins January 1 of the first calendar year following your death. However, if your surviving spouse is your sole designated beneficiary, he or she may delay the first distribution until December 31 of the year for which you would have attained age 70½ if later. If your designated beneficiary is not an individual or made a qualified trust (e.g.regular/spousal contribution, a charity, your estate, etcconversion or an employer plan rollover to any Xxxx XXX you own.), your IRA must be distributed by the end of the fifth calendar year following your death. Generally, each beneficiary may elect the timing and manner regarding the distribution of his or her portion of the IRA. Elections must generally be made by December 31 of the year following your death. If timely elections are not made, your beneficiary is required to take distributions according to the applicable default provision. The default distribution option for designated beneficiaries who are individuals is the life expectancy option and the default distribution option for designated beneficiaries that are not individuals is the 5-year method. If your beneficiary(ies) does not withdraw the required amount within the prescribed time frame, he or she may be subject to the 50% excess accumulation penalty tax on the amount that should have been withdrawn but was not distributed. If your surviving spouse is the sole designated beneficiary of your IRA, he or she may treat your IRA as his or her own IRA by redesignating your IRA as his or her own IRA, failing to take a required distribution as a beneficiary, or by making a contribution. Regardless of whether your spouse is the sole designated beneficiary, he or she may roll distributions from your IRA into his or her own IRA generally within 60 days of receipt. Additional restrictions may apply. If You Die On or After RMDs Are Required to Begin. If you die on or after April 1 following the year you attain age 70½, the designated beneficiary(ies) must continue taking distributions from your IRA. The longest time frame for receiving payouts is over the remaining life expectancy of the applicable designated beneficiary or based on your remaining life expectancy factor, had you not died, whichever period is longer. Distributions must commence by December 31 of the calendar year following your death. If your designated beneficiary is not an individual or a qualified trust (e.g., a charity, your estate, etc.), your IRA must be distributed using your single life expectancy (had you not died) reduced by one each year. Your beneficiary(ies) must withdraw your RMD for the year of your death, if you do not withdraw it before your death. If your surviving spouse is the sole designated beneficiary of your IRA, he or she may treat your IRA as his or her own IRA by redesignating your IRA as his or her own IRA, failing to take a required distribution as a beneficiary, or by making a contribution. Regardless of whether your spouse is the sole designated beneficiary, he or she may roll distributions from your IRA into his or her own IRA generally within 60 days of receipt. Additional restrictions may apply. TAX WITHHOLDING Distributions from your IRA, except certain transfers or any recharacterization, are subject to 10% federal income tax withholding. You may elect in writing not to have withholding apply to your IRA distribution in most cases. If you elect not to have withholding applied, or if you do not have enough federal income tax withheld from your IRA distribution, you may be responsible for payment of estimated tax. You may be subject to penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. In addition to federal income tax withholding, distributions from IRAs may also be subject to state income tax withholding. CORRECTION OF EXCESS CONTRIBUTIONS Any amount you contribute for a tax year that exceeds the allowable contribution amount is an excess contribution and subject to a 6% penalty tax each year it remains in the IRA. You may avoid the penalty tax if you remove the excess contribution along with the net income attributable to the excess before your tax return due date, plus extensions. For assistance in calculating the net income attributable to an excess contribution using an IRS-approved method, refer to Treasury Regulation 1.408-11, IRS Pub. 590-A and your tax advisor. The net income must be included in your taxable income. If you are under age 59½ and do not qualify for an exception, the net income is also subject to the IRS 10% premature distribution penalty. File IRS Form 5329 to pay any penalty taxes. To correct an excess contribution after your tax filing due date (plus extensions), you may withdraw the excess amount (no earnings need to be withdrawn.) Alternatively, if you are eligible to contribute in a subsequent year, you may correct the excess amount by redesignating the amount to a subsequent year. To redesignate a contribution, you under contribute in a subsequent year and claim the original contribution amount when you file your income taxes for that subsequent year. The original amount is either deducted on Form 1040 or claimed as a nondeductible contribution on Form 8606. Regardless of which method you use to correct the excess after your tax return due date, plus extensions, the 6% penalty is required for each year it remained in the IRA.

Qualified Health Savings Account (HSA) Funding Distribution. If you are an HSA eligible individual, you may be eligible to do a tax-free transfer of IRA assets to your HSA. This transfer, which is referred to as a qualified HSA funding distribution, is subject to HSA contribution limits. You must irrevocably elect to treat such distribution as a qualified HSA funding distribution. Generally, you are limited to one qualified HSA funding distribution from any of your Traditional or Xxxx IRAs during your lifetime. For assistance in determining to what extent you may be eligible to make a qualified HSA funding distribution, consult your tax advisor. BENEFICIARY DISTRIBUTIONS TO YOUR BENEFICIARIES WHEN YOU DIE – DEATH OF IRA OWNER BEFORE JANUARY 1, 2020 Any amounts remaining in your IRA at your death will be paid to your beneficiary(ies)) as required under the Code and Treasury Regulations. When If you diedie before January 1, 2020, the rules determining the distribution of your IRA balance depend on a number of factors. These include factors including whether you had a "designated beneficiary," your relationship to the beneficiary (spouse or nonspouse) and whether you died before or after RMDs were required to begin. Designated Beneficiary. A "designated beneficiary" is determined based on the beneficiary(ies) designated as of the date of your death and who remains your beneficiary(ies) on September 30th of the calendar year following the calendar year of your death. If You Die Before RMDs Are Required To Begin. Generally, if you die before April 1 following the year you reach age 70½ and your designated beneficiary(ies) is an individual, he or she may elect a distribution method. Your beneficiary(ies) may elect to deplete the IRA by the end of the fifth calendar year following your death or to receive payments based on the designated beneficiary(ies)’s life expectancy. If life expectancy payments are elected, the payments must begin by December 31 of the first calendar year following your death. However, if your surviving spouse is your sole designated beneficiary, he or she may delay the first distribution until December 31 of the year you would have attained age 72 (age 70½, if you attained age 70½ before 2020), if later. If your designated beneficiary is not an individual or a qualified trust (e.g., a charity, your estate, etc.), your IRA must be distributed by the end of the fifth calendar year following your death. Generally, each beneficiary may elect the timing and manner regarding the distribution of his or her portion of the IRA. Elections must generally be made by December 31 of the year following your death. If timely elections are not made, your beneficiary is required to take distributions according to the applicable default provision. The default distribution option for designated beneficiaries who are individuals is the life expectancy option and the default distribution option for designated beneficiaries that are not individuals is the 5-year methodrule. If your beneficiary(ies) does not withdraw the required amount within the prescribed time frame, he or she may be subject to the 50% excess accumulation penalty tax on the amount that should have been withdrawn but was not distributed. If your surviving spouse is the sole designated beneficiary of your IRA, he or she may treat your IRA as his or her own IRA by redesignating your IRA as his or her own IRA, failing to take a required distribution as a beneficiary, or by making a contribution. Regardless of whether your spouse is the sole designated beneficiary, he or she may roll distributions from your IRA into his or her own IRA generally within 60 days of receipt. Additional restrictions may apply. Pursuant to the Coronavirus Aid, Relief and Economic Security Act of 2020 (CARES Act), certain beneficiaries taking distributions in accordance with the 5- year rule are afforded an extra year to complete distribution from your Inherited IRA. If You Die On or After RMDs Are Required to Begin. If you die on or after April 1 following the year you attain age 70½, the designated beneficiary(ies) must continue taking distributions from your IRA. The longest time frame for receiving payouts is over the remaining life expectancy of the applicable designated beneficiary or based on your remaining life expectancy factor, had you not died, whichever period is longer. Distributions must commence by December 31 of the calendar year following your death. If your designated beneficiary is not an individual or a qualified trust (e.g., a charity, your estate, etc.), your IRA must be distributed using your single life expectancy (had you not died) reduced by one each year. Your beneficiary(ies) must withdraw your RMD for the year of your death, if you do not withdraw it before your death. If your surviving spouse is the sole designated beneficiary of your IRA, he or she may treat your IRA as his or her own IRA by redesignating your IRA as his or her own IRA, failing to take a required distribution as a beneficiary, or by making a contribution. Regardless of whether your spouse is the sole designated beneficiary, he or she may roll distributions from your IRA into his or her own IRA generally within 60 days of receipt. Additional restrictions may apply. TAX WITHHOLDING Required Distributions from Waiver. Pursuant to the Coronavirus Aid, Relief and Economic Security Act of 2020 (CARES Act), distributions required to be withdrawn in 2020 by your IRAbeneficiaries are waived. The federal government may further modify or temporarily suspend required distributions under certain circumstances, except certain transfers such as extreme economic conditions or any recharacterizationother national emergencies. BENEFICIARY DISTRIBUTIONS – DEATH OF IRA OWNER ON OR AFTER JANUARY 1, are subject to 10% federal income tax withholding. You may elect 2020 Any amounts remaining in writing not to have withholding apply your IRA at your death will be paid to your IRA distribution in most casesbeneficiary(ies) as required under the Code and Treasury Regulations. If you elect die on or after January 1, 2020, how quickly the assets must be withdrawn from the Traditional IRA by your beneficiary depends on the beneficiary type (i.e. eligible designated beneficiary, an individual that is not to have withholding appliedan eligible designated beneficiary, a nonperson beneficiary such as a charity or other entity, or if you do not have enough federal income tax withheld from your IRA distribution, you may be responsible for payment of estimated tax. You may be subject to penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. In addition to federal income tax withholding, distributions from IRAs may also be subject to state income tax withholding. CORRECTION OF EXCESS CONTRIBUTIONS Any amount you contribute for a tax year that exceeds the allowable contribution amount is an excess contribution and subject to a 6% penalty tax each year it remains in the IRA. You may avoid the penalty tax if you remove the excess contribution along with the net income attributable to the excess before your tax return due date, plus extensions. For assistance in calculating the net income attributable to an excess contribution using an IRS-approved method, refer to Treasury Regulation 1.408-11, IRS Pub. 590-A and your tax advisor. The net income must be included in your taxable income. If you are under age 59½ and do not qualify for an exception, the net income is also subject to the IRS 10% premature distribution penalty. File IRS Form 5329 to pay any penalty taxes. To correct an excess contribution after your tax filing due date (plus extensionstrust beneficiary), you may withdraw the excess amount (no earnings need to be withdrawn.) Alternatively, if you are eligible to contribute in a subsequent year, you may correct the excess amount by redesignating the amount to a subsequent year. To redesignate a contribution, you under contribute in a subsequent year and claim the original contribution amount when you file your income taxes for that subsequent year. The original amount is either deducted on Form 1040 or claimed as a nondeductible contribution on Form 8606. Regardless of which method you use to correct the excess after your tax return due date, plus extensions, the 6% penalty is required for each year it remained in the IRA.

Qualified Health Savings Account (HSA) Funding Distribution. If you are an HSA eligible individual, you may be eligible to do a tax-free transfer of IRA assets to your HSA. This transfer, which is referred to as a qualified HSA funding distribution, is subject to HSA contribution limits. You must irrevocably elect to treat such distribution as a qualified HSA funding distribution. Generally, you are limited to one qualified HSA funding distribution from any of your Traditional or Xxxx IRAs during your lifetime. For assistance in determining to what extent you may be eligible to make a qualified HSA funding distribution, consult your tax advisor. BENEFICIARY DISTRIBUTIONS TO YOUR BENEFICIARIES WHEN YOU DIE – DEATH OF IRA OWNER BEFORE JANUARY 1, 2020 Any amounts remaining in your IRA at your death will be paid to your beneficiary(ies)) as required under the Code and Treasury Regulations. When If you diedie before January 1, 2020, the rules determining the distribution of your IRA balance depend on a number of factors. These include factors including whether you had a "designated beneficiary," your relationship to the beneficiary (spouse or nonspouse) and whether you died before or after RMDs were required to begin. Designated Beneficiary. A "designated beneficiary" is determined based on the beneficiary(ies) designated as of the date of your death and who remains your beneficiary(ies) on September 30th of the calendar year following the calendar year of your death. If You Die Before RMDs Are Required To Begin. Generally, if you die before April 1 following the year you reach age 70½ and your designated beneficiary(ies) is an individual, he or she may elect a distribution method. Your beneficiary(ies) may elect to deplete the IRA by the end of the fifth calendar year following your death or to receive payments based on the designated beneficiary(ies)’s life expectancy. If life expectancy payments are elected, the payments must begin by December 31 of the first calendar year following your death. However, if your surviving spouse is your sole designated beneficiary, he or she may delay the first distribution until December 31 of the year you would have attained age 72 (age 70½, if you attained age 70½ before 2020), if later. If your designated beneficiary is not an individual or a qualified trust (e.g., a charity, your estate, etc.), your IRA must be distributed by the end of the fifth calendar year following your death. Generally, each beneficiary may elect the timing and manner regarding the distribution of his or her portion of the IRA. Elections must generally be made by December 31 of the year following your death. If timely elections are not made, your beneficiary is required to take distributions according to the applicable default provision. The default distribution option for designated beneficiaries who are individuals is the life expectancy option and the default distribution option for designated beneficiaries that are not individuals is the 5-year methodrule. If your beneficiary(ies) does not withdraw the required amount within the prescribed time frame, he or she may be subject to the 50% excess accumulation penalty tax on the amount that should have been withdrawn but was not distributed. If your surviving spouse is the sole designated beneficiary of your IRA, he or she may treat your IRA as his or her own IRA by redesignating your IRA as his or her own IRA, failing to take a required distribution as a beneficiary, or by making a contribution. Regardless of whether your spouse is the sole designated beneficiary, he or she may roll distributions from your IRA into his or her own IRA generally within 60 days of receipt. Additional restrictions may apply. Pursuant to the Coronavirus Aid, Relief and Economic Security Act of 2020 (CARES Act), certain beneficiaries taking distributions in accordance with the 5-year rule are afforded an extra year to complete distribution from your Inherited IRA. If You Die On or After RMDs Are Required to Begin. If you die on or after April 1 following the year you attain age 70½, the designated beneficiary(ies) must continue taking distributions from your IRA. The longest time frame for receiving payouts is over the remaining life expectancy of the applicable designated beneficiary or based on your remaining life expectancy factor, had you not died, whichever period is longer. Distributions must commence by December 31 of the calendar year following your death. If your designated beneficiary is not an individual or a qualified trust (e.g., a charity, your estate, etc.), your IRA must be distributed using your single life expectancy (had you not died) reduced by one each year. Your beneficiary(ies) must withdraw your RMD for the year of your death, if you do not withdraw it before your death. If your surviving spouse is the sole designated beneficiary of your IRA, he or she may treat your IRA as his or her own IRA by redesignating your IRA as his or her own IRA, failing to take a required distribution as a beneficiary, or by making a contribution. Regardless of whether your spouse is the sole designated beneficiary, he or she may roll distributions from your IRA into his or her own IRA generally within 60 days of receipt. Additional restrictions may apply. TAX WITHHOLDING Required Distributions from Waiver. Pursuant to the Coronavirus Aid, Relief and Economic Security Act of 2020 (CARES Act), distributions required to be withdrawn in 2020 by your IRAbeneficiaries are waived. The federal government may further modify or temporarily suspend required distributions under certain circumstances, except certain transfers such as extreme economic conditions or any recharacterizationother national emergencies. BENEFICIARY DISTRIBUTIONS – DEATH OF IRA OWNER ON OR AFTER JANUARY 1, are subject to 10% federal income tax withholding. You may elect 2020 Any amounts remaining in writing not to have withholding apply your IRA at your death will be paid to your IRA distribution in most casesbeneficiary(ies) as required under the Code and Treasury Regulations. If you elect die on or after January 1, 2020, how quickly the assets must be withdrawn from the Traditional IRA by your beneficiary depends on the beneficiary type (i.e. eligible designated beneficiary, an individual that is not to have withholding appliedan eligible designated beneficiary, a nonperson beneficiary such as a charity or other entity, or if you do not have enough federal income tax withheld from your IRA distribution, you may be responsible for payment of estimated tax. You may be subject to penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. In addition to federal income tax withholding, distributions from IRAs may also be subject to state income tax withholding. CORRECTION OF EXCESS CONTRIBUTIONS Any amount you contribute for a tax year that exceeds the allowable contribution amount is an excess contribution and subject to a 6% penalty tax each year it remains in the IRA. You may avoid the penalty tax if you remove the excess contribution along with the net income attributable to the excess before your tax return due date, plus extensions. For assistance in calculating the net income attributable to an excess contribution using an IRS-approved method, refer to Treasury Regulation 1.408-11, IRS Pub. 590-A and your tax advisor. The net income must be included in your taxable income. If you are under age 59½ and do not qualify for an exception, the net income is also subject to the IRS 10% premature distribution penalty. File IRS Form 5329 to pay any penalty taxes. To correct an excess contribution after your tax filing due date (plus extensionstrust beneficiary), you may withdraw the excess amount (no earnings need to be withdrawn.) Alternatively, if you are eligible to contribute in a subsequent year, you may correct the excess amount by redesignating the amount to a subsequent year. To redesignate a contribution, you under contribute in a subsequent year and claim the original contribution amount when you file your income taxes for that subsequent year. The original amount is either deducted on Form 1040 or claimed as a nondeductible contribution on Form 8606. Regardless of which method you use to correct the excess after your tax return due date, plus extensions, the 6% penalty is required for each year it remained in the IRA.

Qualified Health Savings Account (HSA) Funding Distribution. If you are an HSA eligible individual, you may be eligible to do a tax-free transfer of IRA XXX assets to your HSA. This transfer, which is referred to as a qualified HSA funding distribution, is subject to HSA contribution limits. You must irrevocably elect to treat such distribution as a qualified HSA funding distribution. Generally, you are limited to one qualified HSA funding distribution from any of your Traditional or Xxxx IRAs during your lifetime. For assistance in determining to what extent you may be eligible to make a qualified HSA funding distribution, consult your tax advisor. advisor DISTRIBUTIONS TO YOUR BENEFICIARIES WHEN YOU DIE Any amounts remaining in your IRA Xxxx XXX at your death will be paid to your beneficiary(iesbeneficiary (ies). When you die, Distributions to your beneficiary (ies) within the rules determining the 5-year qualified distribution holding period may be taxed as ordinary income. The 10% penalty tax for premature distributions does not apply to distributions to your beneficiary(ies) after your death. The period of time over which your IRA Xxxx XXX balance depend may be distributed to your beneficiary (ies) depends on a number of factors. These include whether you had a "“designated beneficiary," ” and your relationship to the beneficiary (spouse or nonspouse) and whether you died before or after RMDs were required to begin. Designated Beneficiary). A "“designated beneficiary" ” is determined based on the beneficiary(ies) designated as of the date of your death and who remains remain(s) your beneficiary(ies) on September 30th of the calendar year following the calendar year of your death. If You Die Before RMDs Are Required To BeginFive-Year Holding Period. Generally, if you die before April 1 following Beneficiaries must ensure the five-year you reach age 70½ and your designated beneficiary(ies) is an individual, he or she may elect a distribution method. Your beneficiary(ies) may elect to deplete the IRA by the end of the fifth calendar year following your death or holding period has been satisfied to receive payments based on qualified distributions. The years you were alive are credited toward the designated beneficiary(ies)’s life expectancyfive-year waiting period. If life expectancy payments are electedThat is, the payments must begin by December 31 five-year waiting period is not “re-set” upon your death. The period begins January 1 of the first calendar year following your death. However, if your surviving spouse is your sole designated beneficiary, he or she may delay the first distribution until December 31 of the year for which you would have attained age 70½ if later. If your designated beneficiary is not an individual or made a qualified trust (e.g.regular/spousal contribution, a charity, your estate, etcconversion or an employer plan rollover to any Xxxx XXX you own.), your IRA must be distributed by the end of the fifth calendar year following your death. Generally, each beneficiary may elect the timing and manner regarding the distribution of his or her portion of the IRA. Elections must generally be made by December 31 of the year following your death. If timely elections are not made, your beneficiary is required to take distributions according to the applicable default provision. The default distribution option for designated beneficiaries who are individuals is the life expectancy option and the default distribution option for designated beneficiaries that are not individuals is the 5-year method. If your beneficiary(ies) does not withdraw the required amount within the prescribed time frame, he or she may be subject to the 50% excess accumulation penalty tax on the amount that should have been withdrawn but was not distributed. If your surviving spouse is the sole designated beneficiary of your IRA, he or she may treat your IRA as his or her own IRA by redesignating your IRA as his or her own IRA, failing to take a required distribution as a beneficiary, or by making a contribution. Regardless of whether your spouse is the sole designated beneficiary, he or she may roll distributions from your IRA into his or her own IRA generally within 60 days of receipt. Additional restrictions may apply. If You Die On or After RMDs Are Required to Begin. If you die on or after April 1 following the year you attain age 70½, the designated beneficiary(ies) must continue taking distributions from your IRA. The longest time frame for receiving payouts is over the remaining life expectancy of the applicable designated beneficiary or based on your remaining life expectancy factor, had you not died, whichever period is longer. Distributions must commence by December 31 of the calendar year following your death. If your designated beneficiary is not an individual or a qualified trust (e.g., a charity, your estate, etc.), your IRA must be distributed using your single life expectancy (had you not died) reduced by one each year. Your beneficiary(ies) must withdraw your RMD for the year of your death, if you do not withdraw it before your death. If your surviving spouse is the sole designated beneficiary of your IRA, he or she may treat your IRA as his or her own IRA by redesignating your IRA as his or her own IRA, failing to take a required distribution as a beneficiary, or by making a contribution. Regardless of whether your spouse is the sole designated beneficiary, he or she may roll distributions from your IRA into his or her own IRA generally within 60 days of receipt. Additional restrictions may apply. TAX WITHHOLDING Distributions from your IRA, except certain transfers or any recharacterization, are subject to 10% federal income tax withholding. You may elect in writing not to have withholding apply to your IRA distribution in most cases. If you elect not to have withholding applied, or if you do not have enough federal income tax withheld from your IRA distribution, you may be responsible for payment of estimated tax. You may be subject to penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. In addition to federal income tax withholding, distributions from IRAs may also be subject to state income tax withholding. CORRECTION OF EXCESS CONTRIBUTIONS Any amount you contribute for a tax year that exceeds the allowable contribution amount is an excess contribution and subject to a 6% penalty tax each year it remains in the IRA. You may avoid the penalty tax if you remove the excess contribution along with the net income attributable to the excess before your tax return due date, plus extensions. For assistance in calculating the net income attributable to an excess contribution using an IRS-approved method, refer to Treasury Regulation 1.408-11, IRS Pub. 590-A and your tax advisor. The net income must be included in your taxable income. If you are under age 59½ and do not qualify for an exception, the net income is also subject to the IRS 10% premature distribution penalty. File IRS Form 5329 to pay any penalty taxes. To correct an excess contribution after your tax filing due date (plus extensions), you may withdraw the excess amount (no earnings need to be withdrawn.) Alternatively, if you are eligible to contribute in a subsequent year, you may correct the excess amount by redesignating the amount to a subsequent year. To redesignate a contribution, you under contribute in a subsequent year and claim the original contribution amount when you file your income taxes for that subsequent year. The original amount is either deducted on Form 1040 or claimed as a nondeductible contribution on Form 8606. Regardless of which method you use to correct the excess after your tax return due date, plus extensions, the 6% penalty is required for each year it remained in the IRA.

Qualified Health Savings Account (HSA) Funding Distribution. If you are an HSA eligible individual, you may be eligible to do a tax-free transfer of IRA assets to your HSA. This transfer, which is referred to as a qualified HSA funding distribution, is subject to HSA contribution limits. You must irrevocably elect to treat such distribution as a qualified HSA funding distribution. Generally, you are limited to one qualified HSA funding distribution from any of your Traditional or Xxxx IRAs during your lifetime. For assistance in determining to what extent you may be eligible to make a qualified HSA funding distribution, consult your tax advisor. BENEFICIARY DISTRIBUTIONS TO YOUR BENEFICIARIES WHEN YOU DIE – DEATH OF IRA OWNER BEFORE JANUARY 1, 2020 Distributions to your beneficiary(ies) within the 5-year qualified distribution holding period may be taxed as ordinary income. The 10% penalty tax for premature distributions does not apply to distributions to your beneficiary(ies) after your death. Beneficiaries must ensure the five-year holding period has been satisfied to receive qualified distributions. The years you were alive are credited toward the five-year waiting period. That is, the five-year waiting period is not “re-set” upon your death. The period begins January 1 of the first year for which you made a regular/spousal contribution, a conversion or an employer plan rollover to any Xxxx XXX you own. Any amounts remaining in your IRA Xxxx XXX at your death will be paid to your beneficiary(ies)) as required under the Code and Treasury Regulations. When If you diedie before January 1, 2020, the rules determining the distribution period of time over which your IRA Xxxx XXX balance depend may be distributed to your beneficiary(ies) depends on a number of factors. These include whether you had a "“designated beneficiary," ” and your relationship to the beneficiary (spouse or nonspouse) and whether you died before or after RMDs were required to begin. Designated Beneficiary). A "“designated beneficiary" ” is determined based on the beneficiary(ies) designated as of the date of your death and who remains remain(s) your beneficiary(ies) on September 30th of the calendar year following the calendar year of your death. If You Die Before RMDs Are Required To Begin. Generally, if you die before April 1 following the year you reach age 70½ and your designated beneficiary(ies) is an individual, he or she may elect a distribution method. Your beneficiary(ies) may elect to deplete the IRA by the end of the fifth calendar year following your death or to receive payments based on the designated beneficiary(ies)’s life expectancy. If life expectancy payments are elected, the payments must begin by December 31 of the first calendar year following your death. However, if your surviving spouse is your sole designated beneficiary, he or she may delay the first distribution until December 31 of the year you would have attained age 70½ if later. If your designated beneficiary is not an individual or a qualified trust (e.g., a charity, your estate, etc.), your IRA must be distributed by the end of the fifth calendar year following your death. Generally, each beneficiary may elect the timing and manner regarding the distribution of his or her portion of the IRA. Elections must generally be made by December 31 of the year following your death. If timely elections are not made, your beneficiary is required to take distributions according to the applicable default provision. The default distribution option for designated beneficiaries who are individuals is the life expectancy option and the default distribution option for designated beneficiaries that are not individuals is the 5-year method. If your beneficiary(ies) does not withdraw the required amount within the prescribed time frame, he or she may be subject to the 50% excess accumulation penalty tax on the amount that should have been withdrawn but was not distributed. If your surviving spouse is the sole designated beneficiary of your IRA, he or she may treat your IRA as his or her own IRA by redesignating your IRA as his or her own IRA, failing to take a required distribution as a beneficiary, or by making a contribution. Regardless of whether your spouse is the sole designated beneficiary, he or she may roll distributions from your IRA into his or her own IRA generally within 60 days of receipt. Additional restrictions may apply. If You Die On or After RMDs Are Required to Begin. If you die on or after April 1 following the year you attain age 70½, the designated beneficiary(ies) must continue taking distributions from your IRA. The longest time frame for receiving payouts is over the remaining life expectancy of the applicable designated beneficiary or based on your remaining life expectancy factor, had you not died, whichever period is longer. Distributions must commence by December 31 of the calendar year following your death. If your designated beneficiary is not an individual or a qualified trust (e.g., a charity, your estate, etc.), your IRA must be distributed using your single life expectancy (had you not died) reduced by one each year. Your beneficiary(ies) must withdraw your RMD for the year of your death, if you do not withdraw it before your death. If your surviving spouse is the sole designated beneficiary of your IRA, he or she may treat your IRA as his or her own IRA by redesignating your IRA as his or her own IRA, failing to take a required distribution as a beneficiary, or by making a contribution. Regardless of whether your spouse is the sole designated beneficiary, he or she may roll distributions from your IRA into his or her own IRA generally within 60 days of receipt. Additional restrictions may apply. TAX WITHHOLDING Distributions from your IRA, except certain transfers or any recharacterization, are subject to 10% federal income tax withholding. You may elect in writing not to have withholding apply to your IRA distribution in most cases. If you elect not to have withholding applied, or if you do not have enough federal income tax withheld from your IRA distribution, you may be responsible for payment of estimated tax. You may be subject to penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. In addition to federal income tax withholding, distributions from IRAs may also be subject to state income tax withholding. CORRECTION OF EXCESS CONTRIBUTIONS Any amount you contribute for a tax year that exceeds the allowable contribution amount is an excess contribution and subject to a 6% penalty tax each year it remains in the IRA. You may avoid the penalty tax if you remove the excess contribution along with the net income attributable to the excess before your tax return due date, plus extensions. For assistance in calculating the net income attributable to an excess contribution using an IRS-approved method, refer to Treasury Regulation 1.408-11, IRS Pub. 590-A and your tax advisor. The net income must be included in your taxable income. If you are under age 59½ and do not qualify for an exception, the net income is also subject to the IRS 10% premature distribution penalty. File IRS Form 5329 to pay any penalty taxes. To correct an excess contribution after your tax filing due date (plus extensions), you may withdraw the excess amount (no earnings need to be withdrawn.) Alternatively, if you are eligible to contribute in a subsequent year, you may correct the excess amount by redesignating the amount to a subsequent year. To redesignate a contribution, you under contribute in a subsequent year and claim the original contribution amount when you file your income taxes for that subsequent year. The original amount is either deducted on Form 1040 or claimed as a nondeductible contribution on Form 8606. Regardless of which method you use to correct the excess after your tax return due date, plus extensions, the 6% penalty is required for each year it remained in the IRA.

Qualified Health Savings Account (HSA) Funding Distribution. If you are an HSA eligible individual, you may be eligible to do a tax-free transfer of IRA XXX assets to your HSA. This transfer, which is referred to as a qualified HSA funding distribution, is subject to HSA contribution limits. You must irrevocably elect to treat such distribution as a qualified HSA funding distribution. Generally, you are limited to one qualified HSA funding distribution from any of your Traditional or Xxxx IRAs during your lifetime. For assistance in determining to what extent you may be eligible to make a qualified HSA funding distribution, consult your tax advisor. DISTRIBUTIONS TO YOUR BENEFICIARIES WHEN YOU DIE Any amounts remaining in your IRA XXX at your death will be paid to your beneficiary(ies). When you die, the rules determining the distribution of your IRA XXX balance depend on a number of factors. These include whether you had a "designated beneficiary," your relationship to the beneficiary (spouse or nonspouse) and whether you died before or after RMDs were required to begin. Designated Beneficiary. A "designated beneficiary" is determined based on the beneficiary(ies) designated as of the date of your death and who remains your beneficiary(ies) on September 30th of the calendar year following the calendar year of your death. If You Die Before RMDs Are Required To Begin. Generally, if you die before April 1 following the year you reach age 70½ and your designated beneficiary(ies) is an individual, he or she may elect a distribution method. Your beneficiary(ies) may elect to deplete the IRA XXX by the end of the fifth calendar year following your death or to receive payments based on the designated beneficiary(ies)’s life expectancy. If life expectancy payments are elected, the payments must begin by December 31 of the first calendar year following your death. However, if your surviving spouse is your sole designated beneficiary, he or she may delay the first distribution until December 31 of the year you would have attained age 70½ if later. If your designated beneficiary is not an individual or a qualified trust (e.g., a charity, your estate, etc.), your IRA XXX must be distributed by the end of the fifth calendar year following your death. Generally, each beneficiary may elect the timing and manner regarding the distribution of his or her portion of the IRAXXX. Elections must generally be made by December 31 of the year following your death. If timely elections are not made, your beneficiary is required to take distributions according to the applicable default provision. The default distribution option for designated beneficiaries who are individuals is the life expectancy option and the default distribution option for designated beneficiaries that are not individuals is the 5-year method. If your beneficiary(ies) does not withdraw the required amount within the prescribed time frame, he or she may be subject to the 50% excess accumulation penalty tax on the amount that should have been withdrawn but was not distributed. If your surviving spouse is the sole designated beneficiary of your IRAXXX, he or she may treat your IRA XXX as his or her own IRA XXX by redesignating your IRA XXX as his or her own IRAXXX, failing to take a required distribution as a beneficiary, or by making a contribution. Regardless of whether your spouse is the sole designated beneficiary, he or she may roll distributions from your IRA XXX into his or her own IRA XXX generally within 60 days of receipt. Additional restrictions may apply. If You Die On or After RMDs Are Required to Begin. If you die on or after April 1 following the year you attain age 70½, the designated beneficiary(ies) must continue taking distributions from your IRAXXX. The longest time frame for receiving payouts is over the remaining life expectancy of the applicable designated beneficiary or based on your remaining life expectancy factor, had you not died, whichever period is longer. Distributions must commence by December 31 of the calendar year following your death. If your designated beneficiary is not an individual or a qualified trust (e.g., a charity, your estate, etc.), your IRA XXX must be distributed using your single life expectancy (had you not died) reduced by one each year. Your beneficiary(ies) must withdraw your RMD for the year of your death, if you do not withdraw it before your death. If your surviving spouse is the sole designated beneficiary of your IRAXXX, he or she may treat your IRA XXX as his or her own IRA XXX by redesignating your IRA XXX as his or her own IRAXXX, failing to take a required distribution as a beneficiary, or by making a contribution. Regardless of whether your spouse is the sole designated beneficiary, he or she may roll distributions from your IRA XXX into his or her own IRA XXX generally within 60 days of receipt. Additional restrictions may apply. TAX WITHHOLDING Distributions from your IRAXXX, except certain transfers or any recharacterization, are subject to 10% federal income tax withholding. You may elect in writing not to have withholding apply to your IRA XXX distribution in most cases. If you elect not to have withholding applied, or if you do not have enough federal income tax withheld from your IRA XXX distribution, you may be responsible for payment of estimated tax. You may be subject to penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. In addition to federal income tax withholding, distributions from IRAs may also be subject to state income tax withholding. CORRECTION OF EXCESS CONTRIBUTIONS Any amount you contribute for a tax year that exceeds the allowable contribution amount is an excess contribution and subject to a 6% penalty tax each year it remains in the IRAXXX. You may avoid the penalty tax if you remove the excess contribution along with the net income attributable to the excess before your tax return due date, plus extensions. For assistance in calculating the net income attributable to an excess contribution using an IRS-approved method, refer to Treasury Regulation 1.408-1.408- 11, IRS Pub. Publication 590-A and your tax advisor. The net income must be included in your taxable income. If you are under age 59½ and do not qualify for an exception, the net income is also subject to the IRS 10% premature distribution penalty. File IRS Form 5329 to pay any penalty taxes. To correct an excess contribution after your tax filing due date (plus extensions), you may withdraw the excess amount (no earnings need to be withdrawn.) Alternatively, if you are eligible to contribute in a subsequent year, you may correct the excess amount by redesignating the amount to a subsequent year. To redesignate a contribution, you under contribute in a subsequent year and claim the original contribution amount when you file your income taxes for that subsequent year. The original amount is either deducted on Form 1040 or claimed as a nondeductible contribution on Form 8606. Regardless of which method you use to correct the excess after your tax return due date, plus extensions, the 6% penalty is required for each year it remained in the IRAXXX.