If a participant receives and rolls over an erroneous duplicate payment, but the plan doesn't catch it till a later tax year, does the trustee have to issue a corrected 1099-R for the past tax year? We're trying to accept refunds from a group of participants who got paid twice, but the trustee is refusing to issue corrected 1099-Rs. It claims that it can only issue 1099-Rs for an open tax year.

I'd understand that position if it had been a cash distribution and there was withholding (the correction method there is § 1341, the original distribution is set in stone, and the participant can claim a tax credit for the refund but the old 1099-R stands); but for a direct "rollback" we need to fix the old 1099-R, don't we?

Thanks!

having previously been the tax manager for a corporate trustee, we always issued corrected 1099s.
It was our feeling that it was a fiduciary breech not to correct.

following your trustees rationale there would not be a corrected W-2.

In one particular situation, the participant was overpaid by more than 100,000 and it was necessary to correct in order to settle with the participant and his attorney to resolve overpayment.

if you wish to discuss offliine drop me a note

Thanks, Brett. I sent you a message.