Incorrect State on 1099-R

[mitbrown]

I moved to Indiana establishing residency on June 16, 2022.  However I notified my pension provider (which is a new provider as of July 1, 2022) on July 8, 2022.  Therefore they have issued 2 1099-R forms: 1 for the state of Washington for 1 month of benefits and 1 for the state of Indiana for the remaining 5 months of the year.  I have requested a corrected 1099-R for the one month when I was actually an Indiana resident but the provider refuses claiming they have no proof that I was an Indiana resident effective July 1, 2022.  I contacted Indiana Department of Revenue and they tell me I must get a corrected 1099-R and, if refused, I must start legal action against my benefit provider.  I'm stuck.  My inclination is to just enter Indiana as the state of residence for the 1099-R issued for the month of July benefits even though it shows Washington as the state of residence.  If I file thusly, what is my risk of audit, penalties, etc. from either the IRS or Indiana DOR or both?  I can't be the only person with an incorrect 1099-R resulting from a move to a state with income tax.

[SteamTrain · Accepted solution]

I don' think it will cause a problem to put IN in there, as long as there were no $$ in box 14.   Leaving it as WA would likely be OK too.

The thing is, you will be preparing a part-Year IN tax return anyhow, and during the income "allocation" pages of the part-year tax return, you should be presented with your total pension $$ from the Federal section, and asked to indicate what portion was received while a resident in Indiana, and you will include the $$ from both those 1099-R forms....and any other 1099-R forms representing $$ removed after becoming an IN resident.

But get ALL your Federal income in first...don't start the IN part-year tax return Q&A until you are sure every $$ (interest, dividends, Mutual Fund distributions...everything) has been entered in the Federal section.  The IN tax return will use yoru total income for the year....until you go thru those income allocation pages in the IN interview....so don't panic if $$ due to IN get bigger while entering the $$ in the Federal section.

[Hal_Al]

You'd have a bigger problem if you moved from IN to WA.  IN DOR is not going to have a problem with you reporting more  income than the 1099-R shows

When you enter the 1099-R, just adjust the box 16, for IN, to be the correct amount.