January 2025
Q-1 We have a customer that signed a distribution form to make a charitable distribution to their church They just notified us that they didn’t mean for it to be a 2024 transaction but 2025 instead The cashier’s check is going to be returned to the customer and they want us to reverse the transaction.
Is this something that we should or even could correct?
A-1. You must correct the situation.
If the distribution check was not negotiated by the charity, there was no distribution. So this distribution transaction will not be reported on the Form 1099-R for the individual.
The charity should furnish the check to the bank. Or if the charity gives the individual the check, then the individual should return the check to the bank.
If the bank cannot reverse the distribution, it should report the funds coming back in as a non-reportable transfer.
The charity probably informed the individual a QCD for 2025 cannot be made in 2024.
Is there a “banking” reason why the bank cannot treat the distribution as not having occurred.
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