Re-Issue Check What Date
I have a relationship where the company where he worked sent him a reissue letter. Supposedly they had sent him a check dated 05/01/2012 from his 401k. He had never filled out any forms or contacted the company stating that he wanted to rollover his 401k. After 90 days from 05/01/2012 he receives a reissue letter on 08/22/2012 stating that he had not cashed the check. This was his first correspondence regarding the distribution so he contacted the 401k department and they reissued a check dated 11/30/2012. They did not reference any withholding on the check or any correspondence.
So the check was placed in a rollover on 1/14/2013 within the 60 days.
He just recieved a 1099 showing the Gross distribution 77,266.09 minus taxes withheld $15,453.22 and the net amount $61,812.87 that was put into the Rollover.
Normally, if we were within the 60 Days we could have added the 15,453.22 to the Rollover and then when he filled the adjustments would have taken place. If he didnt have the extra funds, the withholding has already been sent to the IRS so we could theoretically rollover the 61,812.87 and only reported the 15,453.22 as the taxable portion and then he would have received some of the funds back at tax time…
We have since reviewed a letter he received at termination 09/09/2009 which said he could leave the funds in the IRA if over $1000 or until age 65. He had decided to leave the funds in, but did forget about the age 65. He turned 65 in February so 60 days after is what triggered the original check of 05/01/2012. But as stated he did not receive the check.
Here is the Question.
Will the IRS use the original check date of 05/01/2012 or the reissue check date of 11/30/2012. If we are beyond the 60 days then we need to get all the funds out of the IRA Rollover and put them in a taxable account going forward.
Permalink Submitted by Alan - IRA critic on Wed, 2013-01-30 16:07
The 1099R does not show dates, but if the check was reissued, the first one was must have resulted in a stop payment order. All of this does not explain why any of these checks was issued if he never requested a distribution. Did he overlook any notifications from the plan regarding these distributions prior to May? Meanwhile, his 60 days expired yesterday if he RECEIVED the check on 11/30, but if it shows an issue date of 11/30, then he may have received it a few days later and can still complete the rollover.
Permalink Submitted by Kevin Engbers on Wed, 2013-01-30 16:13
Since the original post, we did review a letter that was given to him when he left employment dated 09/09/09. The letter stated any balance over 1000 could be left in the plan until age 65. He decided to leave the money in the plan, but didnt remember the age 65 part. He turned 65 on 02/2012. So that would explain why the first month after 60 days from his 65th birthday would have been 05/01/2012 a check was automatically issued. So it appears they would use the 05/01/2012 date. To answer the response. The check was put in the rollover on 01/14/2012 which would have been within the 60 days.