Bank applied 2020 IRA contribution made in 2021 as a 2021 IRA
After having our 2021 taxes prepared, we made our 2021 IRA contributions into a money market CD, as we have for the past years. We were just contacted by our bank, where we have had a 30+ year relationship, and they told us that we had already made our 2021 contribution LAST year. They said that they can see that we always make our IRA contributions after the yearend but prior to the tax deadline, but that they were unable to correct this error. I said they must have applied it incorrectly; as we had arranged for it over the phone and signed the papers in the car in the drive through due to COVID. They said they were unable to change it and we would either have to withdraw the contribution we recently made or apply it to 2022. The problem with that is it was claimed on our 2020 tax return – it would cost us tax, penalties and a preparers fee to amend our taxes as well as loosing the ability to save the $14,000, that we had intended. Is there any recourse? Is it true that the bank is unable to correct this mistake? Thank you for your help.
Terry Says
Whew, that is a tough one. So, in effect, it’s as if you “skipped” the 2020 deduction, but claimed it for the tax break that year. What bank? A big one? Did you get this response in writing –about their error? Did you ask to speak to a manager?? Send me an email with more details and your contact info and the bank info. Terry@TerrySavage.com
