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anitje

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  1. Actually, I checked and I believe my employer probably used the right form. This from the IRS web site http://www.irs.gov/instructions/i1099r/ar02.html: "Nonqualified plans. Report any reportable distributions from commercial annuities. Report distributions to employee plan participants from section 409A nonqualified deferred compensation plans including nongovernmental section 457(b) plans on Form W-2, not on Form 1099-R; for nonemployees, these payments are reportable on Form 1099-MISC. Also, report distributions to beneficiaries of deceased plan participants on Form 1099-MISC."
  2. Michael- Thanks for the reply. I assume what you are saying is that my 457 distribution is considered deferred compensation, and on that basis I probably cannot make an IRA contribution. That makes sense to me. As for the reporting error that you describe, could that come back to haunt me (since no SS tax was reported withheld on the W-2)? I assume that I would not have any SS tax liability, since I maxed out my SS contributions in the years I worked. But I don't want to run into problems with the IRS or the SS board. Do I need to demand that the former employer correct their error and substitute a 1099-R for the W-2? I don't really care if a mistake was made, unless that mistake will somehow affect me personally. Would contributing to my IRA based on what was reported on the W-2 while not paying SS for the year likely raise a red flag and potentially trigger an audit or result in a penalty? Thanks.
  3. Sorry....I accidentally posted this to the wrong forum. I re-posted it in the 457 forum.
  4. Hi. I had a nongovernmental 457(b) plan. I retired in 2008. My prior employer forced me to liquidate the plan in January 2011, and I received the proceeds as a lump sum in January, 2011. I paid taxes on this sum in 2011. I received a W-2 for 2011 listing the proceeds in Box 1 ("wages, tips, other compensation"). This number is also listed in box 16 ("state wages, tips, etc"), and there are entries for federal tax withheld in box 2, and state income tax in box 17. All other boxes on the W-2 list zero. Two questions: 1. Can I legally contribute to an IRA (tax-deductible) for 2011 based on my W-2? 2. If I do contribute to an IRA for 2011 based on my W-2, will the fact that I have documented compensation on my W-2, but no documented social security tax withheld, put me at high risk for an audit? Thanks in advance.
  5. Hi. I had a nongovernmental 457(b) plan. I retired in 2008. My prior employer forced me to liquidate the plan in January 2011, and I received the proceeds as a lump sum in January, 2011. I paid taxes on this sum in 2011. I received a W-2 for 2011 listing the proceeds in Box 1 ("wages, tips, other compensation"). This number is also listed in box 16 ("state wages, tips, etc"), and there are entries for federal tax withheld in box 2, and state income tax in box 17. All other boxes on the W-2 list zero. Two questions: 1. Can I legally contribute to an IRA (tax-deductible) for 2011 based on my W-2? 2. If I do contribute to an IRA for 2011 based on my W-2, will the fact that I have documented compensation on my W-2, but no documented social security tax withheld, put me at high risk for an audit? Thanks in advance.
  6. Thanks for the reply. From all the research I have done, I do not have the option of reinvesting in a tax-deferred retirement plan since it was in a non-governmental, nonqualified plan. So if I cannot prove them wrong in distributing the funds, I have to pay the taxes on the bulk sum in 2011.
  7. They must have a plan document or policy written somewhere. This benefit rep may be trying to brush you off. But do you want to do? Was this a taxable event, a check mailed to you? Steve Thanks for replying, Steve. Yes, the check was mailed to me, and I do believe she is trying to brush me off. Is a non-qualified plan required to give the holder the option to elect not to withdraw funds after severing employment? And even if I can prove they were wrong in liquidating my account without my permission, what recourse do I have once the check has been mailed to me? What could I claim as damages?
  8. According to my benefits office: "The hospital's Fidelity 457(b) is a non-qualified plan and has a very different set of distribution rules than the 457 plan you reference below. (We are not required to have a plan document on an employee contributed plan; only a summary plan description.)" Is this true? Thanks.
  9. My 457b funds were liquidated and distributed to me by my employer (a hospital) without my prior authorization. I left my employer 3 years ago. The funds were held by Fidelity. The head of benefits at the hospital informed me that after termination of employment they had to distribute the funds to me within one year. However, Fidelity claims there is nothing stating that in the plan documents that they hold. I asked the head of benefits to provide me with plan documentation stating that this is the case and she told me that they do not have such a document. What should I do? Thanks in advance.....
  10. Do all 457(b) plans require plan documents, and must they be made available to participants? A quote from my plan administrator when I asked for such documents: "We are not required to have a plan document on an employee contributed plan; only a summary plan description." Thanks, Michael
  11. First an apology- I accidentally posted this to the 403(b) board, so please forgive a newcomer. I am in a bit of a quandary over the rules surrounding my 457 (b) plan at the hospital where I stopped working on 10/12/08. I am currently unemployed. According to the retirement specialist at the hospital I need to withdraw all funds from this account and pay taxes on the distribution at my current tax rate within 12 months of termination, and she does not have to provide me with a plan document detailing the rules for me . The following is her quote: "The hospital's Fidelity 457(b) is a non-qualified plan and has a very different set of distribution rules than the 457 plan you reference below. As mentioned in your "Benefits upon Termination" document that was e-mailed to you on 10/3/08, this plan is only rollable to another non-qualified 457(b) plan. If you are employed at an institution or group that has a non-qualified 457(b) plan, then I can assist with the rollover. Otherwise, this plan is required to be paid out within 1 year of your termination date of 10/12/08 as referenced in the summary plan description I have attached. (We are not required to have a plan document on an employee contributed plan; only a summary plan description.)" However, according to information I read on http://www.457bwise.com/faqs/index.html, I am not sure this is the case. A quote from that webpage: Private plan participants generally will pay federal income taxes when funds are made available to them. They may, however, defer receiving funds and instead be taxed when they actually take distribution]. I have gotten bad information from the retirement specialist in the past. If I do not have to take the distribution this year (2009), and can defer it, this will make a big difference, as taking the distribution would significantly raise my 2009 tax liability . Please let me know if you know anything about this, and if I have any options to avoid a large 2009 tax bill. I do not need the funds. Thanks in advance , Michael
  12. First an apology- I realized too late I should have posted this to the 457 forum. Please forgive a newcomer. I am in a bit of a quandary over the rules surrounding my 457 (b) plan at the hospital where I stopped working on 10/12/08. I am currently unemployed. According to the retirement specialist at the hospital I need to withdraw all funds from this account and pay taxes on the distribution at my current tax rate within 12 months of termination, and she does not have to provide me with a plan document detailing the rules for me . The following is her quote: "The hospital's Fidelity 457(b) is a non-qualified plan and has a very different set of distribution rules than the 457 plan you reference below. As mentioned in your "Benefits upon Termination" document that was e-mailed to you on 10/3/08, this plan is only rollable to another non-qualified 457(b) plan. If you are employed at an institution or group that has a non-qualified 457(b) plan, then I can assist with the rollover. Otherwise, this plan is required to be paid out within 1 year of your termination date of 10/12/08 as referenced in the summary plan description I have attached. (We are not required to have a plan document on an employee contributed plan; only a summary plan description.)" However, according to information I read on http://www.457bwise.com/faqs/index.html, I am not sure this is the case. A quote from that webpage: Private plan participants generally will pay federal income taxes when funds are made available to them. They may, however, defer receiving funds and instead be taxed when they actually take distribution]. I have gotten bad information from the retirement specialist in the past. If I do not have to take the distribution this year (2009), and can defer it, this will make a big difference, as taking the distribution would significantly raise my 2009 tax liability . Please let me know if you know anything about this, and if I have any options to avoid a large 2009 tax bill. I do not need the funds. Thanks in advance , Michael
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