I have a self-directed Roth IRA, an IRA LLC, that has a brokerage account at Ameritrade. The EIN was not listed correctly with Ameritrade and so they began taking backup withholdings in 2021. I didn't realize this until recently and sent them a corrected w9. Now I have the challenge of trying to figure out how to recoup the taxes withheld.
Ameritrade treats the account as a single member llc and not an IRA. The single member in the LLC is the IRA, which is standard for self directed IRA llc accounts. Since they don't treat it as an IRA I don't get a 1099-R for it.
So on my taxes I created a substitute 1099-R. I put the gross distribution as the tax amount withheld in box 1. I checked box 2b "tax amount to be determined" and I put the taxes withheld in box 4 (Fed income taxes withheld). For the code in Box 7 I chose "T-Roth distribution, exception applies"
I filled out form 4852 explaining the substitution reason.
I have prior contributions so there was no tax on a withdrawal since it is a Roth. But I really don't want to withdrawal this money. I can check off the rollover box and deposit the money back (if that even is allowed) but the amount of the withholdings for 2022 are around $20k and I don't have a spare $20k lying around to wait a year for the IRS to pay me back.
Can someone please advise first off if I am reporting this correctly on my taxes and then any thoughts how to handle getting this money back in to the IRA? Help is greatly appreciated.
