Is it possible to 'undo' an ill-advised Roth distribution? Or at least to avoid taxes and penalties?My mom has moderate/severe sleep apnea. She just got diagnosed last month and has started treatment. Hopefully she will be just fine soon. Unfortunately, her sleep apnea left her with a lot of cognitive defecits. Memory loss, confusion, poor judgment, etc. Quite frankly I was worried that she had Alzheimer's. In fact, she had been prescribed Aricept, an anti-Alzheimer's drug. I was just about to get a power of attorney over her finances because she was no longer properly managing her money. The good news is she should be just fine in about 4-6 more weeks.The bad news is that a few months ago (Sept. 2000), when her mind was still very much in a fog due to her sleep disorder, she called up one of her mutual fund companies and requested a check for $10,000 from a Roth IRA which she had converted in 1998. She didn't need the money, and certainly not from a recent Roth conversion.I still have the check. It has not been cashed. The mutual fund company said they can't do anything because more than 60 days has passed.Can I approach the IRS and ask for help? I told mom numerous times to leave the Roth alone for 5 years. Will they allow her to 'undo' the distribution? Did the distribution happen if the check never gets cashed? Will they at least not make her pay taxes and a penalty on the distribution?I've read IRS Form 590 and I'm not exactly sure.I originally asked TMFKaren, and she suggested I seek the advice of Foolish CPA's.Thanks Fools!P.S. Don't ignore snoring, excessive daytime sleepiness, and chronic poor sleep. Sleep disorders are real and they are treatable.
Best Of |
Favorites & Replies |
Start a New Board |
My Fool |
BATS data provided in real-time. NYSE, NASDAQ and NYSEMKT data delayed 15 minutes.
Real-Time prices provided by BATS. Market data provided by Interactive Data.
Company fundamental data provided by Morningstar. Earnings Estimates, Analyst Ra