Question about change individual 401k custodian from Fidelity to TDA

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Topic Author
kchnew
Posts: 46
Joined: Wed Dec 13, 2017 10:44 am

Question about change individual 401k custodian from Fidelity to TDA

Post by kchnew »

I recently transferred my individual/solo 401k from Fidelity to TD Ameritrade to take advantage of the Roth contribution. I thought this is direct trustee-to-trustee transfer. However, Fidelity marked this as direct rollover, and told me a 1099-R will be generated. Basically Fidelity said this is reportable event, even though not taxable event, and said TDA needs to generate form 5498. Since quite a few people here have done this kind of solo 401k transfer before, I really appreciate for the help:

1. is it the normal process for Fidelity to generate 1099-R even though this is direct trustee-to-trustee transfer?
2. As I understand, form 5498 only applies to IRA account, not for 401k account. So what form does TDA need to generate to show the funds has been transferred to my solo 401k account in TDA?

Thanks ahead.
ERISA Stone
Posts: 1626
Joined: Tue Jun 24, 2014 8:54 am

Re: Question about change individual 401k custodian from Fidelity to TDA

Post by ERISA Stone »

kchnew wrote: Wed Dec 13, 2017 11:05 am I recently transferred my individual/solo 401k from Fidelity to TD Ameritrade to take advantage of the Roth contribution. I thought this is direct trustee-to-trustee transfer. However, Fidelity marked this as direct rollover, and told me a 1099-R will be generated. Basically Fidelity said this is reportable event, even though not taxable event, and said TDA needs to generate form 5498. Since quite a few people here have done this kind of solo 401k transfer before, I really appreciate for the help:

1. is it the normal process for Fidelity to generate 1099-R even though this is direct trustee-to-trustee transfer?
2. As I understand, form 5498 only applies to IRA account, not for 401k account. So what form does TDA need to generate to show the funds has been transferred to my solo 401k account in TDA?

Thanks ahead.
This is not a reportable event on a 1099. There should be no 5498 either. Someone in the Fidelity operations doesn't quite understand.
Topic Author
kchnew
Posts: 46
Joined: Wed Dec 13, 2017 10:44 am

Re: Question about change individual 401k custodian from Fidelity to TDA

Post by kchnew »

Thanks a lot for the quick reply. I called again the Fidelity small business dept. This time, I was told the fidelity description of "DIR Roll to IRA ACAT Deliver...." is a generic term, and as long as it says "ACAT", the transfer is between likely accounts, which is 401k to 401k in my case, and is not reportable to IRS. No 1099 is going to be generated. So hopefully Fidelity does what I have been told and not gives me surprise later on.

This actually brought one observation. From the beginning of this year, every time when I called Fidelity, the waiting time becomes much longer, and the answer to the question is not consistent most of the time. Thanks again for your help!
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