Ah, that’s what I’m missing! Fascinating. Thank you, Sir ..read more

Father can report it as a 2022 SEP contribution on his return, but VG can only report the contribution on Form 5498 for the year IN WHICH it is made (2023). It is up to the IRS to reconcile his tax return with the 5498. The 5498 reporting for an individual IRA account is different, as these contributions are reported for the year the contribution is for, eg 2022 or 2023. Therefore, an individual IRA contribution for 2022 will be reported on the 2022 5498. Because his contribution was reclassified by VG to a SEP contribution, his 2022 5498 should NOT show this contribution because it is no long ..read more

My understanding was that this SEP (employer) contribution, re-coded from the individual contribution, would be made for Tax Year 2022 (deadline: April 15th, 2023 without an extension).   ..read more

A SEP (employer) contribution must be reported on the 5498 for the year in which it is made (2023), therefore this contribution will be reported on the 2023 5498.  However, the 2022 5498 should NOT show the individual contribution because of the correction VG did. VG was able to make this correction because it was still timely and they had not reported the contribution to date. His 2022 return can be filed reporting the contribution as a SEP contribution, but be sure to check in early June when he should have received the 5498, that this contribution does not show on that form ..read more

Update: my father called Vanguard this morning, explained the problem, and they re-coded the contribution to be employer-type. He wrote down the Confirmation Number given to him to document the change. My plan is to next check his 2022 Form 5498 when it is received, and verify that the contribution is employer-type. Any other recommended actions that I should take? I thank you ..read more

I thank you, sir ..read more

Contributions to a SEP IRA are normally SEP (employer) contributions, but regular IRA contributions can also be made to a SEP IRA. The type of contribution made must be disclosed to the SEP custodian for purposes of Form 5498 reporting. Since these contributions are either employer or employee contribution, they cannot be recharacterized between the two. The regular IRA (employee) contribution can be withdrawn with allocated gain or less allocated loss by 10/16/2023 if the 2023 return is either filed by 4/18 or an extension is filed by 4/18. A separate SEP contribution can be made by the same ..read more

My father, a sole proprietor in his late 70s, made a 2022 Individual (Employee) contribution to his SEP IRA on 3/02/23, but has likely exceeded the income threshold for deductibility in 2022. What are the options to correct before April 18, 2023? Can the contribution be recharacterized as an Employer contribution, subject to the net profit contribution limit ..read more

Table 1 would only apply if ownership of the inherited IRA was not elected by the surviving spouse. Since both of you are RMD age, there is no reason for the surviving spouse not to elect ownership. The surviving spouse will be responsible for completing the RMD for the year of death if the deceased spouse did not complete it. For the year after the year of death, if the surviving spouse elects ownership anytime in that year they are treated as the owner for the entire year and can use the Uniform Table for that year. Therefore, there will be no need to use the single life table and it’s highe ..read more

My wife and I are both in our 70’s and have named one another as the sole beneficiary of our IRAs.  Currently, we are both using Table 3 to calculate our annual RMDs. Am I correct in assuming that once one of us passes away, the surviving spouse can still use Table 3 to calculate their RMD? I’m asking because I’m confused with respect to whether Table 1 would be applicable ..read more