1099R

[Guest btbucks]

We are wondering whether a fee that we charge for the distribution of a participant's account is to be included in Box 1 of the 1099R. If so, should it also be included in the taxable amount box?

Thanks for your help!

[John Feldt ERPA CPC QPA]

A) Was the participant's account reduced to pay your fee, or B) was the full account paid and then you tyracked down the participant to get the fee from their funds after distribution?

Since A) is likely the case, then your fee should not be reported as paid out to the particpant on the 1099-R (since it was never paid to them).

[Guest btbucks]

That was our opinion as well but, we have people who differ in their opinions.

Thank you J4!

A) Was the participant's account reduced to pay your fee, or B) was the full account paid and then you tyracked down the participant to get the fee from their funds after distribution?

Since A) is likely the case, then your fee should not be reported as paid out to the particpant on the 1099-R (since it was never paid to them).