incorrect 1099r

Forum|Forum|1 year ago
September 17, 2024
2 replies
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I liquidated an annuity that was not a retirement account. My financial advisor sent the company a transfer request to liquidate the annuity and to have the money deposited directly into my account at his firm. He did not request a 1035 exchange. However, the annuity company recognized it as such and when I received my 1099r, it had no tax taxable amount in box 2a and "6" in box 7 on the 1099r. The annuity company says that since he sent a transfer request and not a "full surrender form" they automatically treat it as a 1035 exchange. Obviously, by the time I got my 1099r, the 60 day exchange period was long past not to mention that the money had already been invested in a taxable account. The annuity company says they can't issue a corrected 1099r even though my financial advisor says he filled out the request properly and did not request a 1035 exchange. So how do I report my taxable income earned from this annuity without having the correct figures on my 1099r? Is there a way of putting in the numbers correctly in the appropriate boxes and attaching a statement on my return given that there is absolutely no way that I will get a corrected 1099r from the annuity company?

Best answer by dmertz

I agree with the annuity company that the financial advisor made a mistake by requesting a transfer, so I would not expect the annuity company to agree to change the Form 1099-R.

There is no provision in the tax code that allows a 60-day rollover of a nonqualified annuity, so immediately upon being deposited into the non-annuity account it became an ordinary distribution from the annuity despite the reporting with code 6 on the Form 1099-R. Absent the annuity company issuing a corrected Form 1099-R, you'll need to submit a substitute Form 1099-R (Form 4852) to provide the correct reporting (with, presumably, code 7 in box 7 and the difference between box 1 and box 5 in box 2a. In TurboTax you'll need to mark the entry as being a substitute Form 1099-R.

Anonymous_

Employee

Is there any other solution beyond attaching a statement if you cannot get a corrected 1099-R?

I'll page @dmertz for input.

dmertzAnswer

Employee

I agree with the annuity company that the financial advisor made a mistake by requesting a transfer, so I would not expect the annuity company to agree to change the Form 1099-R.