Distribution Question
I have a client who requested a withdrawal from her 403b account that she has with me. She wanted to turn the forms in prior to Jan. 1 to avoid the new requirement to have a employer signature after Jan. 1 — privacy concerns. I advised her to fax in the form on December 31st, 2008 and the funds would be distributed in 2009 because our normal processing time is 7-10 days. She did that, but low and behold our processing department turned her request around in a matter of minutes and the money went out in 2008. Exactly what she did not want. Our internal processing folks have balked at reversing the transaction. Is there a way to correct this for the client?
Permalink Submitted by Denise Appleby on Tue, 2009-01-13 08:08
[quote=”[email protected]“]I have a client who requested a withdrawal from her 403b account that she has with me. She wanted to turn the forms in prior to Jan. 1 to avoid the new requirement to have a employer signature after Jan. 1 — privacy concerns. I advised her to fax in the form on December 31st, 2008 and the funds would be distributed in 2009 because our normal processing time is 7-10 days. She did that, but low and behold our processing department turned her request around in a matter of minutes and the money went out in 2008. Exactly what she did not want. Our internal processing folks have balked at reversing the transaction. Is there a way to correct this for the client?[/quote]
She could rollover the amount to her traditional IRA within 60-days, which would make it nontaxable.