Retirement fund wants me to lie on my tax return

[mark39]

What is the name of your state (only U.S. law)? Washington

Toward the end of 2008, my retirement fund sent several of my withdrawals to another bank where I do not have an account. Sometime in January, 2009, the fund discovered its errors and sent the money to my correct account. However, the fund wants to report (on the 1099 form) that it sent the money in 2008. In essence, it wants to lie to the IRS, wants me to lie to the IRS and pay taxes on money I never received in the tax year, and wants to put me in a higher tax bracket.

Is this not tax fraud and is this not subornation of fraud by the retirement fund? Or am I just a drama queen and should go along with this process because nobody really cares?

Thanks.

 

[LdiJ]

What is the name of your state (only U.S. law)? Washington

Toward the end of 2008, my retirement fund sent several of my withdrawals to another bank where I do not have an account. Sometime in January, 2009, the fund discovered its errors and sent the money to my correct account. However, the fund wants to report (on the 1099 form) that it sent the money in 2008. In essence, it wants to lie to the IRS, wants me to lie to the IRS and pay taxes on money I never received in the tax year, and wants to put me in a higher tax bracket.

Is this not tax fraud and is this not subornation of fraud by the retirement fund? Or am I just a drama queen and should go along with this process because nobody really cares?

Thanks.

I can see an argument in either direction. The retirement fund did disburse the money in 2008.

If it was a flat out error on their part that they sent the money to the wrong bank, then you may have an argument that you did not have constructive receipt in 2008. However, if you had any part in the error (ie changed banks and you didn't get the info to them fast enough...or weren't a squeeky wheel when the money didn't get to you when you expected it) then it may legitimately be a 2008 withdrawal.

Either way its not tax fraud...so in that area yes, you are being a drama queen. Its a constructive receipt argument/disagreement.

Also, in the end you are going to take it into income in either 2008 or 2009, and for many reasons it could do greater damage to you for 2009 than 2008. So unless you know for certain, that your marginal tax rate will be much lower for 2009, it may not be a battle worth fighting.

 

[mark39]

Thanks

LdiJ,

Thank you for your helpful response. Best wishes.