Retirement tax questions

@fivesixteen 

First, your custodian issued an incorrect 1099-R from the beginning.  Code G for direct rollover is only allowed if the money went directly from the first plan to the second plan.  If the money came to you, that was an indirect rollover and the 1099-R should have been code 1, early distribution.  Then you would certify on your tax return that it was a rollover within 60 days.  You need a corrected 1099-R.

 

Then, you need to file an amended return with the corrected 1099-R, indicate you did not complete the rollover.  The entire distribution is taxable income to you, with a penalty if you are under age 59-1/2.

 

By the way, how was the rollover processed and why did it fail?  If it really was supposed to be a direct rollover, but it failed for reasons outside of your control, you might be able to claim an extension of the 60 day requirement, and complete the rollover now.  It might be worth looking at those circumstances just in case there is a way out.