401k Loan Repayment

[bkmDanno]

Thanks a lot!  I'll be back on the phone with Ameritrade in the morning.

[macuser_22]

It is a 60 day rollover except the law extended the 60 day period to the due date or extended due date of the tax return.  The financial institution does not need to know any for the details other than you tell them that is is a qualified indirect rollover.      Your other financial business is none of their business.   For all they know, you closed an IRA with xyz bank last week and want to roll that money into your account.

[bkmDanno]

Thanks again!  I'll see if Ameritrade changes their tune tomorrow after explaining what you've explained to me.

Dan

[bkmDanno]

Hi, thanks for the extra info.  It really helps.

Dan

[macuser_22]

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@bkmDanno wrote:

Thanks again!  I'll see if Ameritrade changes their tune tomorrow after explaining what you've explained to me.

Dan

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You do not need to explain ANYTHING to them.   Just tell them that you are doing a qualified  60 day indirect rollover form another qualified account.    The details are your business - not theirs.

[bkmDanno]

Got it!  Thanks!

[bkmDanno]

I do see another possible problem.  The 60 day rollover option on Ameritrade's form says only one rollover is allowed per year (I assume that's an IRS rule) but I rolled over the remaining balance of the Vanguard 401k to Ameritrade last August.  Hopefully, since I'm filing for an extension, all I have to do is wait until after the August date and do the rollover before the October 15, 2021 filing date.

[macuser_22]

The one per year rollover applies to *IRA* rollovers.   This is NOT an IRA rollover between IRA accounts so that rule does not apply.

[bkmDanno]

I was wondering about that and having trouble finding a specific answer anywhere.  Thank you for clearing that up.

[bkmDanno]

I was going to file for an extension but my return is complete so I can file my return before the 17th.  But I'm assuming that if I have the 401k loan payback funds wired to my Ameritrade account before the 17th and Ameritrade already has the rollover instructions from me, that it will satisfy the IRS time requirement even if Ameritrade's process goes past the 17th to put the funds into my IRA.  Do you know if that's true?  

[Opus 17]

@bkmDanno 

You should apply for the 4868 extension, then wait a day before you file.  The rollover will be reported to the IRS using the date when Ameritrade processes the transaction, not the date when you request it.  If they take a few days, you could still end up being late.  Making financial transactions on a tight deadline is always dangerous.  If you get the extension, you will have protected yourself against any bank delay that is beyond your control.  

[macuser_22]

I agree.   Many financial have it in fine print in the account agreements that they can take 3 business days to post a transaction.  Since the 17th is Monday and weekends do not count as business days,  even if repaid tomorrow  (the 13th) it might  not post until the 18th making it late.

Apply for an extension online here:

http://turbotax.intuit.com/irs-tax-extensions/

[bkmDanno]

You're absolutely right - no need to take a chance when it's not necessary.  I would have liked to have gotten it all out of the way right now and not had to file an extension but better safe than sorry. 

Thank you both!

[Critter-3]

Yes ... file the extension then wait to file the return until you have confirmation from the broker that the deal is done.