Missed SEPP 72t payment
Client has had 72t SEPP distribution program in place for years. Through broker error (he admits) 2010 distribution not made. Is there an established IRS correction program or are we forced to request a PLR? Thanks
Client has had 72t SEPP distribution program in place for years. Through broker error (he admits) 2010 distribution not made. Is there an established IRS correction program or are we forced to request a PLR? Thanks
Permalink Submitted by Alan Spross on Wed, 2011-02-23 21:09
Unfortuneately, there is no established correction procedures. It will require a PLR at a cost of $10,000 plus legal fees. That said, the chances of a positive ruling are decent if there is limited negligence on the taxpayer’s part. This link summarizes the situation with respect to “error correction PLRs”:
http://72t.net/Articles/Articleshow.aspx?WA=870e2089-7523-49e3-8252-b2e2…
One poster was even successful at getting the responsible custodian to issue a 2010 1099R when they discovered their error and distributed the funds late. But now that the 1099R forms are completed, that would be an unlikely result, but nothing lost in making the effort to apply pressure to the custodian especially if the broker is on staff.