Trustee to Trustee Rollover
An IRA account held by Bank A as trustee was transferred to Bank B who became trustee of the account. After the action was completed, Bank A sent to owner of the IRA account (at his home address) a check for $3.64 noted as a check of final distribution, instead of sending it to the new Bank B now acting as trustee of the IRA account. How can this be resolved
Permalink Submitted by Jose Morales on Wed, 2009-01-28 21:42
The first step is to call Bank A and ask them if they cut the check as a reportable distribution or as a non-reportable transfer. Even if they are reporting this as a distribution the client should still be able to rollover the check to the new IRA as long as it’s done within 60 days of receipt and if they have not completed a rollover of the same IRA funds within the last 12 months.
FYI, “Trustee to Trustee Rollover” is not a term you want to be in the habit of using. A Transfer and a Rollover are two completely different transactions that result in very different tax reporting consequences.