Form 5498 reports your Coverdell ESA contributions to the IRS

IRS Form 5498 is a tax document that your Coverdell ESA custodian (usually a bank or investment firm) sends to you and the IRS each year. It reports how much money was contributed to your Coverdell account during the tax year. The form arrives in January or February and covers contributions made between January 1 and December 31 of the previous year.

You do not use Form 5498 to claim a tax deduction on your tax return. Instead, you report Coverdell contributions yourself on IRS Form 2439 or directly on your tax return, depending on your filing method. Form 5498 is an informational document — it tells the IRS that your custodian received and recorded your contributions, so the agency can cross-check your own reporting.

The form also shows the fair market value of your Coverdell account on December 31, which matters if you need to calculate required minimum distributions (though Coverdell accounts have no required distributions while the account owner is alive).

Key Takeaways

  • Form 5498 shows contributions your custodian received for your Coverdell ESA during the tax year and arrives in January or February.
  • You report your own contributions on your tax return using Form 2439 or your tax software; Form 5498 is informational only.
  • The form lists the account value on December 31, which the IRS uses to verify your reported contribution amounts.
  • You should receive one Form 5498 for each Coverdell account you own, even if you contributed to multiple accounts in the same year.

What information appears on Form 5498

Form 5498 contains several boxes, each reporting a different piece of information about your account. Box 1 shows total contributions made to your Coverdell ESA during the tax year. Box 2 shows rollover contributions (money moved from another Coverdell account). Box 5 displays the fair market value of your account on December 31.

The form also includes your name, Social Security number, and the custodian's name and tax ID number. This information allows the IRS to match the form to your tax return. If you contributed to a Coverdell for a beneficiary (such as your child), the form will show the beneficiary's name and Social Security number as well.

Most custodians send Form 5498 electronically to the IRS and mail a copy to you. You should receive your copy by February 15 each year. If you do not receive it by mid-February, contact your custodian to request a duplicate.

How Form 5498 differs from Form 1099-R

Form 5498 reports money going into your Coverdell account (contributions). Form 1099-R reports money coming out of your account (distributions or withdrawals). You may receive both forms in the same year if you contributed to one Coverdell and withdrew from another, or if you rolled money between accounts.

Form 1099-R shows the gross amount withdrawn and whether the withdrawal was for a may have access to education expense. Form 5498 does not address withdrawals at all. When you file your taxes, you use Form 1099-R to report distributions; you use Form 5498 only as a reference to verify that your custodian recorded your contributions correctly.

Why the IRS sends Form 5498 to you

The IRS receives a copy of every Form 5498 your custodian files. The agency uses these forms to verify that people claiming Coverdell contributions on their tax returns actually made those contributions. If you report a $2,500 contribution but your custodian's Form 5498 shows only $2,000, the IRS will flag the discrepancy.

Form 5498 also helps the IRS track whether you have exceeded the annual contribution limit. For 2024, the Coverdell contribution limit is $2,000 per beneficiary per year, regardless of how many accounts you open for that beneficiary. If you contributed $1,200 to one Coverdell and $1,000 to another for the same child, Form 5498 from both custodians will show those amounts, and the IRS can see the total.

What to do if Form 5498 contains an error

If Form 5498 shows an incorrect contribution amount, account value, or beneficiary information, contact your custodian when ready. The custodian can issue a corrected Form 5498 (marked as a correction) and file it with the IRS. You should receive the corrected form before you file your tax return.

Do not ignore an error on Form 5498. If the form shows a higher contribution than you actually made, the IRS may think you exceeded the contribution limit. If it shows a lower contribution, you may not receive the tax deduction you are may have access to to. Ask your custodian for a written confirmation of the correction and keep it with your tax records.

If your custodian does not correct the error, you can file Form 8275 (Disclosure Statement) with your tax return to explain the discrepancy and support your own reporting. However, it is faster and simpler to have the custodian issue a corrected Form 5498.

Keeping Form 5498 for your records

Save Form 5498 with your tax return and supporting documents for at least three years. The IRS can audit your return within three years of filing, and Form 5498 proves that your custodian recorded your contributions. If you ever need to show the history of your Coverdell account — for example, if you roll the account to another custodian — Form 5498 documents the account value at year-end.

You do not need to attach Form 5498 to your tax return when you file. Your custodian files it directly with the IRS. However, keep your copy as proof that you made the contributions you reported.

Frequently Asked Questions

Do I need Form 5498 to claim my Coverdell contribution on my tax return?

No. You report your contribution using Form 2439 or your tax software, not Form 5498. Form 5498 is informational — it tells the IRS that your custodian received your contribution. You use it to verify that the amount your custodian reported matches what you contributed.

What if I contributed to multiple Coverdell accounts in the same year?

You will receive a separate Form 5498 from each custodian. Add up all the contributions shown on all your forms to make sure you did not exceed the annual limit. The IRS will see all the forms and will know your total contributions across all accounts.

Can I use Form 5498 to claim a tax deduction?

No. Coverdell contributions are not tax-deductible. You contribute with after-tax money. The tax benefit comes when the money grows in the account and when you withdraw it for may have access to education expenses tax-free. Form 5498 straightforward documents that you made the contribution.

What should I do if I never receive Form 5498?

Contact your custodian and ask them to send you a copy. If they cannot locate it, ask for a written statement showing your contributions and account value on December 31. You can file your tax return without Form 5498 in hand, but keep the custodian's written confirmation with your records in case the IRS asks about your contribution.

Does Form 5498 show how much my Coverdell account earned?

No. Form 5498 shows only contributions and the total account value on December 31. To calculate your earnings, subtract your total contributions from the December 31 value. Your custodian's year-end statement will also show earnings separately.