What is the name IL My husband had a life insurance policy for years that was paid for by it's own dividends and we lost track of the whole issue when we moved so didn't know there was a problem. Last year we received notice from irs that our 2008 return had to be amended because of a deficiency. That is because they had gotten a late form 1099R from the insurance company (like in June!) We knew nothing about this and never got any notice or explanation. Their filing told the irs that he received over $9,000 in “retirement income” in 2008, when he actually never received anything at all.
I’ve been trying to get the insurance co to send us further information for months – about all they say on the phone is the policy has lapsed and is not in effect. They keep promising to send a statement. The irs calculated, from this 1099R that we now owe an additional $1,700 in tax for 2008. (We just finished paying them a large amount for that year that we owed and THOUGHT everything was finally settled – now this!)
How can the insurance company say that he received ‘retirement income’ when all that happened was the policy lapsed at some point, and in addition to that it was a life insurance policy not retirement pension. I feel they might have sent the wrong form to irs. I know there was a loan on the policy MANY years ago, and read about a ‘taxable event’ but how can we deal with this problem? Is it worth it so go to tax court, we got papers that say we can “petition the tax court” by a certain date …. or would we be better off pursuing some sort of adjustment – especially as our only income is SSD and we never received this $9,000 at any time. Please help !Where should I start?
of your state (only U.S. law)?