IRA Transfer Corrections
Hello,
My spouse is in the process of transferring her Traditional IRA from Prudential Annuities to E*Trade. On September 8, 2022, Prudential mail a check of the entire balance to E*Trade but her account was restricted as she updated her US mailing address a month before.
The E*Trade account restriction was caused by her new mailing address to be Canadian and as a result, the check could not be deposited and was mailed to Canada. She then opened another IRA account at another firm and transferred the balance that was at E*Trade.
We need to have Prudential cancel the initial check and issue a new one to be deposited in the new IRA account. Prudential is saying that they cannot do that and that they can only issue the check once again to E*Trade. We are concerned that with very little time left before the 60-day allowed for the transfer and that she will have a taxable event with the 10% early withdrawal penalty charged by the IRS. She is a US citizen. Can’t Prudential amend and cancel the first transaction and wire the funds to the new broker? What is our best option?
Thanks
Permalink Submitted by Alan - IRA critic on Wed, 2022-10-19 17:00
She is only allowed one 60 day rollover over a 12 month period. How were the funds at E Trade moved to the new firm? Who is the payee on the Prudential check, E Trade FBO spouse or your spouse personally? If payable to E Trade, this is a non reportable transfer and such transfers are unlimited, but if not accepted the transfer should be terminated and the funds remained at Prudential. She might then be able to have the new custodian pull the funds out of Prudential by direct non reportable transfer.
Permalink Submitted by Martin Arsenault on Wed, 2022-10-19 18:15
Alan, Thanks for your inputs. I am not sure about the exact terminology but the transfer from E*Trade to the new firm was done electronically from the new brokerage firm.The Prudential check was made out to E*Trade FBO my wife.It seems like the only way to transfer funds from Prudential is via check or wire. We tried electronically from E*Trade and from the new firm, but Prudential was never in the populatable lists of financial institutions as they may use a transfer agent.
Permalink Submitted by Martin Arsenault on Wed, 2022-10-19 17:23
Normal
0
false
false
false
EN-US
X-NONE
X-NONE
/* Style Definitions */
table.MsoNormalTable
{mso-style-name:”Table Normal”;
mso-tstyle-rowband-size:0;
mso-tstyle-colband-size:0;
mso-style-noshow:yes;
mso-style-priority:99;
mso-style-parent:””;
mso-padding-alt:0in 5.4pt 0in 5.4pt;
mso-para-margin-top:0in;
mso-para-margin-right:0in;
mso-para-margin-bottom:8.0pt;
mso-para-margin-left:0in;
line-height:107%;
mso-pagination:widow-orphan;
font-size:11.0pt;
font-family:”Calibri”,sans-serif;
mso-ascii-font-family:Calibri;
mso-ascii-theme-font:minor-latin;
mso-hansi-font-family:Calibri;
mso-hansi-theme-font:minor-latin;
mso-bidi-font-family:”Times New Roman”;
mso-bidi-theme-font:minor-bidi;}
Alan, Thanks for your inputs. I am not sure about the exact terminology but the transfer from E*Trade to the new firm was done electronically from the new brokerage firm.The Prudential check was made out to E*Trade FBO my wife. It seems like the only way to transfer funds from Prudential is via check or wire. We tried electronically from E*Trade and from the new firm, but Prudential was never in the populatable lists of financial institutions as they may use a transfer agent.
Permalink Submitted by Alan - IRA critic on Wed, 2022-10-19 17:41
These were not distributions, so both the 60 day deadline and the one rollover limit are not concerns. However, the whereabouts of the Prudential funds are. Uncompleted transfers due to various technical reasons such as this are not uncommon, and the funds should be returned to the issuer. You need to determine if this is in process or something went wrong. Once it is clear that the aborted transfer funds are back at Prudential, she could initiate another transfer from the new brokerage firm like the one that pulled over funds that were previously at E Trade.
Permalink Submitted by Martin Arsenault on Wed, 2022-10-19 18:30
Thanks.I will ask Prudential to cancel the check and put the money back into Prudential.
Permalink Submitted by Martin Arsenault on Wed, 2022-10-19 19:07
I want to thank you by sending you a monetary gift. How can I do that? You have been the most helpful person we spoke with lately. You put our minds at ease.
Permalink Submitted by Alan - IRA critic on Wed, 2022-10-19 19:13
Appreciate the gesture, but I don’t accept any gifts in any form. But I hope these custodians will cooperate with you to get this fixed. LIfe insurers are tougher to deal with than brokers in these matters.