Correcting Missed RMD for thirteen years

Talk about Correcting Missed RMD! The most alarming case of missed Required Minimum Distributions I have ever seen is for 13 years of missed distributions.

The person was referred to us to evaluate a variable annuity he was sold when his mother passed away. She has passed 14 years prior.  The IRA accounts she has were consolidated into a new variable annuity.

However that is where the error was made.  The stockbroker was excited, sad his client had passed, nonetheless excited to have retained the funds.

The stockbroker opened a new account.  The various accounts were put all into this one annuity – which is okay to do.

The annuity was not designed to hold a variable annuity.  The annuity had an income rider and a couple of other features that aren’t allowed on inherited IRA accounts.

We put the variable annuity company on the phone.  They at first denied any responsibility.  They wanted to distribute the entire annuity and wash their hands of the issue.

After escalating the issue to a special department we were able to make some progress.  The annuity company retroactively calculated the missed RMDs and released that money.

After receiving that money we again reached out to the annuity company.  This time to address the riders that were not allowed to be installed on an inherited IRA.  This resulted in approximately $14,000 being returned to the client’s inherited IRA.

There is one more rider for us to retroactively remove…

Correcting Missed RMD

In the meantime, once the RMDs had been distributed (over $40,000) we filled out the paperwork with the client.  The paperwork being the appeal to the IRS to waive the penalty for missing the RMD’s.

This is somehow in the queue with the IRS.

Now, to have the financial advisor pay the fees for processing all of these requests… to the tune of about $10,000.

If you have an issue you want assistance with, please fill out the inquiry form below.

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Master Limited Partnerships – Don’t let the tax tail wag the dog

Thought for the week March 19, 2012

Please enjoy our thought of the week for the week of March 19, 2012 – Master Limited Partnerships: Don’t let the tax tail wag the dog.

For a number of years, Global Financial has invested in Master Limited Partnerships (MLPs), principally to generate attractive levels of income and potentially participate in any capital gain that may accrue from this, at times, undervalued and under-covered asset class.

In this article we discuss Disadvantages, Background Information on Master Limited Partnerships and the Tax Implications of MLPs.

Read the full article here: Thought for the Week – Mar 19 2012

Thought for the week March 19, 2012

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IRA Owners or Beneficiaries!

Welcome to our website.  We focus on missed required minimum distributions and how to get back on track.

Ed Slott Master Elite IRA
A proud member of the Ed Slott Master Elite IRA Group

Please feel free to add your questions here.  IRA Owners or Beneficiaries need to take notice.  If you own or are a beneficiary you may need to take required minimum distributions called RMDs or MDRs.

If you’ve missed a distribution, we’ll get back to you as quickly as possible!  Getting caught up on your RMD is not difficult when you have someone to guide you through the process.

Ed Slott

One of the greatest points we’d make is that we too, like the Wall Street Journal, have Ed Slott’s entire team of IRA Technical Analysts on call.  If we don’t know the answer here, we can call anyone of the Technical Analysts.

We affectionately consider this the beginnings of an IRA Owner’s manual and FAQs.

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