Made contributions to a 457 account in 2017 and 2018. I then retired and rolled the funds over to an IRA account with Vanguard in 2H2018. The 457 firm then did an audit and notified me in February, 2019 I had made excess contributions in both 2017 and 2018 which were included in the rollover amount. Now trying to straighten it all out.
The 457 firm has issued two 1099-R for 2018: one with a Distribution Code (box 7) of "P - Excess contributions plus earnings/excess deferrals (and/or earnings) taxable in 2017" and the second with a Distribution Code of "8 - Excess contributions plus earnings/excess deferrals (and/or earnings) taxable in 2018."
Vanguard is returning the excess contributions and earnings and will issue a 1099-R for 2019 for that amount.
The 457 firm says their 1099-Rs are "informational only and do not need to be reported on my 2018 return." Instead, I will report the Vanguard 1099-R on my 2019 return (the year the funds were actually returned).
Would appreciate advice as to whether this interpretation is correct. Thanks in advance for your help.
