Distribution check not cashed - 1099R issued?

[Guest apsgrazetti]

We issued a distribution check to a participant in November 2009, however the check has not yet been cashed. Do we issue a 2009 Form 1099R for this participant?

My understanding is a 1099R is issued when the check is issued to the participant - not when it is cashed.

Any guidance would be appreciated.

[mbozek]

We issued a distribution check to a participant in November 2009, however the check has not yet been cashed. Do we issue a 2009 Form 1099R for this participant?

My understanding is a 1099R is issued when the check is issued to the participant - not when it is cashed.

Any guidance would be appreciated.

A participant cannot avoid being taxed by not cashing the check. Taxation occurs when the check is mailed.

[Guest Sieve]

Assuming the check was recevied.

[J Simmons]

Assuming the check was recevied.

So, the mail box rule does not apply to issue of whether benefits payment has been made? Actual receipt is required?

[Guest Sieve]

Frankly, I have no idea! As a non-TPA/recordkeeper/custodian, I've never dealt with it.

But, I would figure, at a minimum, that an involuntary distribution sent to the wrong address and returned by the post office--or lost in the mail & never delivered--would not be treated as "made available". Likewise, I would think, for a requested distribution sent to the wrong address. And I don't see it being treated the same as constructively-received employee compensation.

[J Simmons]

--or lost in the mail & never delivered--would not be treated as "made available".

And who would know? Not the TPA/recordkeeper/custodian who sent it and is now preparing the Form 1099-R. What's a poor TPA/recordkeeper/custodian to do? Only send out distribution checks via certified mail, return receipt requested?

[Guest Sieve]

The issuer of the check would prepare a Form 1099-R for the year of distribution in all circumstances unless the check is returned as undeliverable, in which case I believe the 1099-R ought to be issued/filed only for the withheld amount (unless the withheld amount is used to offset other pension distributions during the year or unless a refund of the withheld amount is requested).