Client received 1099R from Fidelity showing 245,000 taxable normal distribution when actually 215,000 was directly transferred out to purchase 2 annuities with client receiving the 30,000. Client tried to get Fidelity to reissue the 1099 to show only the 30,000 taxable...they would not. Can I report the 215 as a rollover and the 30 taxable, or is it in fact all taxable since the 215 bought annuities?
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John -
It depends on if the annuities are under a IRA or non-IRA account. -
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Type of annuity purchased determines your answer
You will need to obtain more information from your client and/or Fidelity.
Was this an institution-to-institution transaction? If so, the Form 1099-R is probably correct. What is the letter code shown in Box 7 ?
Funds placed into a plain vanilla annuity cannot be deemed a qualifying rollover.
Funds placed into an Individual Retirement Annuity likely can be deemed a qualifying rollover.
Info: http://www.wsj.com/articles/SB123819047047960763
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