Annuity Question
Hello,
I have a annuity question that I would like to get your thoughts on. Annuity company processed 2 distributions from 2 annuity IRAs for the same client on the same day. Client deposited the 2 checks as indirect rollovers to their IRA. Now the client has 2 60-day rollovers in a 12-month period.
The 1099-R shows the total distribution amount coming out of the annuities and the 5498 shows the full amount being rolled over, so the tax documents offset each other. Is there any precedence (ie. PLR) to show that the IRS may consider the 2 distributions to be the same distribution if processed on the same day from the annuity company (and reported together on the 1099-R?
Any guidance would be greatly appreciated. Thank you.
Permalink Submitted by Alan - IRA critic on Mon, 2024-02-26 17:17
No clear guidance either way. If these distributions were from a single IRA annuity which was closed, there could be relief per PLR 2011-05047. However, if there were two different IRA annuities distributed, only one can be rolled over to another IRA, although the other could have been rolled to a qualified plan or converted to Roth, the first of which would avoid taxation and the conversion would have avoided the penalty and preserved the IRA balance in a more valuable Roth account. If still within 60 days of the distributions, one of these rollovers could be done using other funds or using the second rollover money after being removed as an excess IRA contribution.