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Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 11136
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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Third time the IRS is telling me that my 401K contribution

Customer Question

For the third time the IRS is telling me that my 401K contribution wasn't correct because fidelity didn't make the contribution before 4/15. I initiated the transfer a couple of days before the cut-off in each case. Fidelity says they did their part. Do I have recourse?
Submitted: 1 year ago.
Category: Tax
Expert:  Lane replied 1 year ago.
Hi,.The answer will turn on whether Fidelity failed to do something they owe you by contract (the fine print in your account application) or whether this was caused by something they couldn't control, such as you having to sell securities in an individual account and wait for the trade to settle,.Most security transactions, including stocks, bonds, municipal securities, mutual funds traded through a broker, and limited partnerships that trade on an exchange, must settle in three days. Government securities and stock options settle on the next business day following the trade. (Securities & Exchange commission)..Can you tell me more about the transaction?.I'll be here..Lane
Customer: replied 1 year ago.
I have Fidelity sending a letter stating when the request for the transfers were received. I will have more information soon.
Expert:  Lane replied 1 year ago.
Great ... I'll be here ... was it just cash?
Expert:  Lane replied 1 year ago.
OK, still don't see you coming back in..If this HAS helped, I'd appreciate a positive rating, by clicking or touching, the smiley faces or stars on your screen ... that's the ONLY WAY I'm credited for the work here..BUT, I'll be here if you need more on this one.Lane
Customer: replied 1 year ago.
That's an interesting point. I'm not really expecting Fidelity do do anything about it but I do want to dispute it with the IRS. If I initiate the transfer before the deadline have I satisfied the rule for my 401K contribution? Fidelity is writing a letter for me stating when the contributions were initiated.
I tried to respond to the email about your answer when it was sent but the link didn't work. I just tried it again from home and it still didn't work.
Expert:  Lane replied 1 year ago.
Sorry, I'm not sure how the email stuff works ,,, the site (Just Answer) is sending those emails..I can do what's called an "additional Services" offer where we can confidentially share email/phone but unless I do that I see everything through this "conduit.".Sounds like you may be home free, however..If Fidelity will document that you did your part on time IRS should allow..Let me know how it goes...Lane.If this HAS helped, I'd appreciate a positive rating, by clicking or touching, the smiley faces or stars on your screen ... that's the ONLY WAY I'm credited for the work here..BUT if you'd like me to send the offer so we can talk it through moe directly, let me know. I'll send it for the least amount possible; $5..Lane.