Late IRA Contribution
A 2011 IRA contribution was timely delivered on April 14, 2012 to the custodian but the check was sent back because it did not specify the precise account number of the IRA account. However, the check did have the correct name of the account and the year for which the deposit was being made.
When the check was received back a new check was immediately reissued and delivered to the custodian. However, it was received and reported as deposited after the April 15th deadline.
How can we get the IRS to recognize this as a contribution for 2011?
Thank you
Miguel
Permalink Submitted by Alan - IRA critic on Wed, 2014-01-22 22:56
The year of contribution will be as reflected on the Form 5498 issued by the IRA custodian in May, 2012. Good chance the custodian applied it to 2012 (reported on May, 2013 5498), so if there was also another contribution for 2012, this would create an excess contribution. IRA owner should first look at the 2011 and 2012 5498 forms to determined how the custodian reported this contribution and other contributions that might have been made for 2012. If there is a question about these forms the account statements should also be checked to see which year the contribution was applied to. There is no sense taking this up with the IRS, and in fact the custodian is also going to resist looking into this 2 years later. About the only chance of a 2011 contribution now is if the custodian recorded it for 2011 in the first place. And if so, the possibility of a 2012 excess should be investigated.
Permalink Submitted by Miguel Rodriguez on Thu, 2014-01-23 14:03
Thank you Alan, that is pretty much what i suspected. We are trying to get the custodian to change the year back to 2011 but not confident that will happen.If we are not successful with the custodian do you have any ideas on how to approach IRS?
Permalink Submitted by Alan - IRA critic on Thu, 2014-01-23 17:22
If that contribution was reported to you and IRS for 2012, did you make another contribution for 2012 which would create an excess 2012 contribution?
Permalink Submitted by Miguel Rodriguez on Thu, 2014-01-23 18:53
No but in 2012 got into an employer sponsord 401k plan which would make the 2012 IRA contribution non-deductible
Permalink Submitted by Alan - IRA critic on Thu, 2014-01-23 20:56
If that happened and the contribution was coded to 2012, all you could do is file an 8606 to report a non deductible contribution. At least that would prevent double taxes on this amount when you eventually distributed it or converted it. It is now too late to withdraw a 2012 contribution. The best solution is obviously to get it re coded to 2011, but the odds of that happening do not look good.
Permalink Submitted by Miguel Rodriguez on Thu, 2014-01-23 20:57
Thank you – I appreciate your help