1099-R shows rollover, however client got check?

[taxbrewster]

And the hits just keep on comin....

Client receives 1099-R for $38k with distribution code G for rollover.

However, when the client receives the check, the new financial institution does not allow the check, and client then deposits check into personal account. (why the bank allowed this, not sure) Uses it for personal use. (doesn't contact me at any point)

They contact the financial, No new 1099-R will be issued showing that is now is an early distribution (via the company that cut the check)

I am curious on how to report this.

I can't create my own 1099-R but I am wondering what to do. So it will be reported correctly.

Thanks.

[RitaB]

Just report it correctly, as if the form had distribution code "1" in box 7. I don't think you'll hear a word. Be sure he pays penalty, and I guess you could attach a note. I doubt I would bother, unless you wanna charge him real good for it, since he apparently doesn't bother talking to you...

[taxbrewster]

Ok, thanks for the info.