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Q: After IRA conversion, I have no 1099-R. What should I do? ( No Answer,   1 Comment )
Subject: After IRA conversion, I have no 1099-R. What should I do?
Category: Business and Money > Accounting
Asked by: ywamer-ga
List Price: $5.00
Posted: 10 Aug 2006 20:27 PDT
Expires: 09 Sep 2006 20:27 PDT
Question ID: 754880
Let me begin by mentioning that I have filed an extension with the IRS
to delay filing until August 15, 2006.  And this date is coming very

The Problem:
During the end of tax year 2005, I ordered a Traditional to Roth IRA
conversion.  It appeared that this was executed normally.  However, I
only received a 1099-B form detailing the sales of the Traditional IRA
mutual fund shares.  Going online to my brokers website, I was able to
download Form 5498, which shows all the funds were reported like an
ordinary contribution.

In other words, on the 1099-B, there is (for example) a sale of 200
shares worth $4400.  Then, on the 5498, it shows a contribution of $4400
in box 10 - along with my regular annual contribution of $1000.

Alas, it appears that I made annual contributions to the new Roth
account of $5400 - too much for a single person and unallowed without
a 6% tax, I believe.

My question is:  What do I do now?  Can I file a 1099-R on my own and
attach a letter of explanation?

If I were to do that, what would I put in boxes 2 and 3 that ask for
the taxable amount and capital gains? What about the code for box 7?

Help!  I want to get this stright and filed corectly, but when phone
calls to my broker don't even help, what can I do?
There is no answer at this time.

Subject: Re: After IRA conversion, I have no 1099-R. What should I do?
From: abezon-ga on 20 Aug 2006 20:54 PDT
First, you have until Oct. 15 to file, as the autimatic extension is 6 months. 
Second, you should never have received a 1099-B for sales from an IRA.
IRAs produce ordinary income. Period.
There are 2 possibilities azs to what happened. Either your broker
sold assets in your regular taxable account & contributed the money to
the Roth IRA, or your broker doesn't have a clue how to report IRA
conversions. In either case, I'd recommend finding a new firm/broker.
If your broker sold the taxable account & contributed the money to the
Roth, you have to withdraw the excess contributions (plus earnings) &
report the stock sales on Sch.D. You'll also want to write the IRS &
request that they waive any penalties for overcontribution & explain
that the broker messed up.
If your broker converted the IRA to a Roth but screwed up the
reporting forms, you can report the stock sales on Sch. D & show $0
gain, then report the net conversion amount on the IRA line of the
1040 (15 or 16). Write "Conversion" to the left of box 15/16b.

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