Well, I'm screwed. IRS is after me.

[lildreamer316]

I won't be able to figure it out until tommorrow, but sometime during 2005 I transferred money from one (inherited) IRA acct. to another, and now they are saying that is income and I owe 10K.

I.
am.
SCREWED.

:cry:

[LeftyFingerPop]

1. I'm not sure why this would be a taxable event...

Could you provide more details? Were both plans indeed qualified IRA's?

[lildreamer316]

7. Yes,n/t

[Mojambo]

2. Hide in a giant, multinational corporation that contributes to Republicans

They never look there.

In all seriousness, best of luck.

[mainegreen]

3. Wait, what? Was this an IRA rollover?

Or did you just transfer money for the hell of it?

[lildreamer316]

5. They are IRAs my mother had, I

inherited them on her death.
One was TIACREF (Teachers's fund); and the other was with Edward Jones. After much study and consultation with my Ed Jones guy, we decided to take the money out of the CREF fund and put it into some other accounts with Ed Jones, because I was only getting 1% at CREF.

I'm an idiot. I think it may be my fault.

[LeftyFingerPop]

8. If this was on the advice of some fucker at Edward Jones and he didn't tell you about the...

tax consequences, I would go wring his fucking neck, then I would sue them.

All these guys are crooks.

[wain]

13. I agree. TIAA CREF on a five year avg does way better than 1%

It's these Jone's financial types that hustle the dollar and created sub-prime mess

[lildreamer316]

15. I have a feeling he did tell me,

but I am ADD and don't remember.
Dammit, I feel like a such a ditz loser now.

[ileus]

11. I picked a 6 year payout when my mother died in 2005.

I pay taxes on each years check this made it easier than taking a lump sum payment that was another option.

[mainegreen]

12. Oh, that may be why.

It wasn't your IRA, and I think that if she deposited into the IRA pre-tax, the government is going to want their cut now. Not a normal rollover.
But then, I'm no tax attorney so I could be, and probably am, full of shit on this one.

[LeftyFingerPop]

4. Was the check made out to you personally, or FBO...

for the benefit of you made out to the financial institution? if it was made out to you directly, they are saying that you had constructive receipt of the funds, and therefore, the receipt is taxable.

The check should have been made out something like: Payable to Morgan Stanley FBO lildreamer. If it was not and this was just an administrative screw-up, you, with the help of a good tax accountant, may be able to establish an immediate paper trail of the funds directly into the receiving IRA.

[lildreamer316]

6. OK...

I don't remember a check. I believe this was all handled by my broker; I remember being in the office on the phone with the first company; getting the money out and telling them where to transfer it to.
Sheesh.
Thanks.

[LeftyFingerPop]

10. You might have a case against Jones...or at least you can raise a stink.

[flvegan]

9. Worth $500 to hire a tax attorney.

Then, if victorious, go after them for fees and costs.

[lildreamer316]

14. YEs, but I really don't have that either.

We might be able to pull it together though.
Cross your fingers for me; I'm using all the connections I can.
Thanks.

[leftyclimber]

16. You don't necessarily need a tax attorney

but you definitely, at the least, need a CPA (my dad is one). You don't need to talk to one of the people whose name is on the sign; ask to talk to one of the "cheap ones." They'll know what you're talking about, hook you up with the person who has the skill set and bills the lowest, and should be able to advise.

:hug:

[Scooter24]

17. Hmmm.

First, was the transfer a trustee-to-trustee transfer? And was the transfer to a titled inherited IRA?

I truly hope that the funds were transfered this way and not via a rollover to the new IRA. The entire distribution amount in this case will be taxable.

I'd immediately ask for copies of all paperwork regarding these accounts and set up a meeting with your broker to discuss the method of transfer. This will be key in determining what triggered the tax. Unfortunately, tax laws don't allow for the beneficiary to correct the error. However, your broker can be held liable :)

I hope this helps. I'm sending you good vibes :hug: