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I am looking for some guidance on the following scenario please. In January 2023 an HSA account holder intended to contribute x amount toward the 2022 tax year. Howeever, in error, he contributed the funds toward the 2023 tax year. In February 2023 all funds are transferred to a new HSA trustee in a trustee-to-trustee transfer. In March the account holder realizes the error and requests to have the January contribution recoded as a 2022 contribution. What obligation does the new trustee have to make this correction? How will this correction affect the trustee's 5498-SA filing? -
Plan Rollovers by Estates to Inherited IRAs
Guest posted a topic in Distributions and Loans, Other than QDROs
Can an estate directly transfer defined contribution retirement plan accounts to inherited IRAs benefiting the estate's beneficiaries in a manner similar to direct transfers from IRAs held by estates? In PLR 201208039 the IRS permitted an estate that was the sole named beneficiary of an IRA to make direct trustee to trustee transfers into separate inherited IRAs (one for each of the estate's beneficiaries). The transfers did not constitue taxable distributons and the beneficiaries were able to defer required minimum distributions over the remaining life expectancy of the decedent. It would be very helpful if similar direct IRA transfers were permitted for defined contribution retirement plans. However, it appears that estates are not permitted to transfer (rollover) retirement plan accounts under Tax Code Section 402©(11)(A) because estates do not qualify as individual designated beneficiaries under Tax Code Section 401(a)(9)(E).