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#675590 - 01/30/07 05:56 PM 1099-Rs and IRA rollovers
TaraHay Offline
Junior Member
Joined: Jan 2007
Posts: 45
Please tell me other banks have the same problem that we do. Each and every year our customers that took IRA distributions and rolled them to other institutions receive their 1099-R's that list the rollover amount as "taxable" and call us in a panic, thinking we've filled out the form wrong. This year we've even had customers threaten to sue us because they believe we filled out the 1099-R incorrectly. We've had to call the IRS with the customer in front of us just so that they would tell the customer that the form was correct.

So...anyone else?

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#676137 - 01/31/07 01:52 PM Re: 1099-Rs and IRA rollovers TaraHay
etm614 Offline
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etm614
Joined: Jan 2003
Posts: 695
Massachusetts
I have a related question. We have some customers who have IRA funds from another institution sent directly to us,labeled as IRA -rollover; however, the funds are deposited into either a savings or checking account. Some staff think that because it was labeled as a rollover, we could be liable for not depositing it into an IRA. Since the sending FI will file a form 1099-R, I don't think it's our problem. It is up to the customer to move it into an IRA - we can't deposit it into an IRA that the customer has not established (or even an existing one if the transfer did not designate it for the deposit). Am I correct?

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#676146 - 01/31/07 02:04 PM Re: 1099-Rs and IRA rollovers etm614
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 83,219
Galveston, TX
Tara - There is nothing you can do about customers that don't understand the IRS rules. It is up to them to report correctly on their tax returns.

etm614 - I would not accept a IRS direct roll-over transfer that did not end up into an IRA account.
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The opinions expressed here should not be construed to be those of my employer: PPDocs.com

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#676836 - 01/31/07 07:59 PM Re: 1099-Rs and IRA rollovers rlcarey
TaraHay Offline
Junior Member
Joined: Jan 2007
Posts: 45
etm: The customer is responsible for completing the rollover properly, not the institutions involved. With that being said, it would be best from a customer service standpoint to question the customer about the check and probably even refuse to take the check.

Regarding the 1099 issue...I realize that we're doing everything correctly and we can't do much about customers who don't understand how to file taxes. I was just hoping that I wasn't alone!

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#677154 - 01/31/07 10:32 PM Re: 1099-Rs and IRA rollovers TaraHay
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 83,219
Galveston, TX
Tara - you are definitely not alone. We all have felt your pain at one time or another.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

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#679957 - 02/05/07 08:06 PM Re: 1099-Rs and IRA rollovers TaraHay
etm614 Offline
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etm614
Joined: Jan 2003
Posts: 695
Massachusetts
Easier said than done when it happens to be one of your directors (who think the rules don't apply to them).

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