topic pension lump sum from company went to wrong account in Retirement tax questions

pension lump sum from company went to wrong account

txmet — Tue, 10 Mar 2026 07:08:34 GMT

i took a lump sum distribution from my pension, funds were supposed to go directly to my ira but went to regular brokerage account instead. the brokerage then had to do withdrawal of funds from brokerage and deposited them in ira, THe brokerage will not consider it a direct rollover since the funds went to the brokerage account first

the company reporting as a direct rollover but will it be indirect since the funds were then moved from the brokerage to ira. the 1099 will have dist g but it the brokerage will not show it that how. how to fix, the company refused to change the code

Re: pension lump sum from company went to wrong account

Opus 17 — Mon, 07 Nov 2022 20:23:42 GMT

You have to go by what actually happened, it is an indirect rollover. However, as long as you completed the process within 60 days, no tax is owed. You just can't do another indirect rollover for 365 days.

You have two options. Simplest is to simply report the 1099-R with whatever it says, even though it is technically incorrect. More complicated is to report the rollover using a "substitute 1099-R" that you create in Turbotax that uses the correct codes. I would probably just report whatever the 1099-R says, your tax return won't be any different.

Re: pension lump sum from company went to wrong account

dmertz — Tue, 08 Nov 2022 01:49:43 GMT

As long as it was done by the 60-day rollover deadline, just make sure that the Form 5498 from the brokerage will show it as a rollover contribution and not a regular contribution. A rollover contribution is shown the same on Form 5498 whether the rollover was direct or indirect.