rmd reported incorrect by brokerage, after properly done in-kind rollover to employer 457b

Submitted by arun parikh on Sun, 2021-05-09 17:48

last year i did in-kind rollover from brokerage tIRA to employer 457b ira.
also did roth conversion, several months apart
they sent one 1099R correctly.

But on second 1099R, under distribution code, brokerage wrongly put “7, normal distribution,” instead of “G, direct rollover”
they erroneously COMBINED the 2 transactions

when i called, they said the 5498 from the receiving entity will show correct rollover. but 5498 comes way after filing.
we are stuck how to report all this mess. maybe just file extension, pay taxes due, etc.?
HELP



Submitted by Alan - IRA critic on Sun, 2021-05-09 19:52

Was the rollover to 457b a direct rollover?  If so, it should be coded G and the 1099R should be corrected by the IRA custodian. For the Roth conversion, 7 is the correct code unless you are under 59.5.  These two transactions must be reported on separate 1099 R forms, or could be done with one form but each distribution separately reported and separately coded.

Submitted by arun parikh on Mon, 2021-05-10 18:28

thx alani am always happy with your promptness and claritytheir 1099r did NOT report and code each distribution separately.  they refuse to send a “corrected” 1099r.  these are HIGH six-figure amountsthx

Submitted by arun parikh on Mon, 2021-05-10 18:30

i see that my response got “muddled up” by your site.  i do have good grammar and syntax

Submitted by Alan - IRA critic on Mon, 2021-05-10 20:13

Was the amount rolled over to the 457b first distributed to you, and then you wrote your own check to the 457b plan?  If so, the single 1099R coded 7 would be correct, otherwise they should issue separate 1099R forms. If it is wrong, but no withholding is involved, you could report as issued, with an explanatory statement included regarding the amount rolled over to the 457b. You would need the explanatory statement even if the 1099R form showed a direct rollover Code G because the 457b plan does not issue Form 5498. The conversion portion would be reported on Form 8606. 

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