UPDATED RESOLUTION - Vanguard never finalized a Roth recharacterization - next steps
UPDATED RESOLUTION - Vanguard never finalized a Roth recharacterization - next steps
So apparently Vanguard never completed my recharacterization of my Roth contribution to Traditional IRA last year. They never sent any thing other than a message in my Vanguard account about it (which I just now saw), no phone calls, emails, paper mail, etc. Pretty irritated with Vanguard at this point.
What options do I have now? My CPA filed that it was completed for the 2019 year, as I thought it was given I had filed out the paperwork to have it completed.
What options do I have now? My CPA filed that it was completed for the 2019 year, as I thought it was given I had filed out the paperwork to have it completed.
Last edited by mx711yam on Thu Jun 23, 2022 8:52 am, edited 1 time in total.
- bertilak
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Re: Vanguard never finalized a Roth recharacterization - next steps
Did you call VG and ask them to fix things?mx711yam wrote: ↑Tue Jul 13, 2021 10:23 am So apparently Vanguard never completed my recharacterization of my Roth contribution to Traditional IRA last year. They never sent any thing other than a message in my Vanguard account about it (which I just now saw), no phone calls, emails, paper mail, etc. Pretty irritated with Vanguard at this point.
What options do I have now? My CPA filed that it was completed for the 2019 year, as I thought it was given I had filed out the paperwork to have it completed.
May neither drought nor rain nor blizzard disturb the joy juice in your gizzard. -- Squire Omar Barker (aka S.O.B.), the Cowboy Poet
Re: Vanguard never finalized a Roth recharacterization - next steps
Yeah, she said there is nothing they can do but take the money out and pay a 6% fine per year. She really seemed like she could care less, I was a little surprised at her indifference.
Waiting for a call back from my CPA to see how bad that is going to mess up the 2019 return.
Waiting for a call back from my CPA to see how bad that is going to mess up the 2019 return.
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Re: Vanguard never finalized a Roth recharacterization - next steps
Sounds like she(?) is implying it is your mistake, not theirs. Doesn't make sense, though. I guess it depends on what "finalize" means. Who is supposed to initiates that "finalize" step?
May neither drought nor rain nor blizzard disturb the joy juice in your gizzard. -- Squire Omar Barker (aka S.O.B.), the Cowboy Poet
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Re: Vanguard never finalized a Roth recharacterization - next steps
Earlier this year, I contributed to a Roth and had to rechar. to a traditional. The steps were simple : called VGCS, he did some calculation, moved the contribution plus the earning to tIRA, I saw a comfirmation when logged in the next time, also saw it logged in the transaction history. I was then free to do whatever with that money.
"Never finalized..." meaning they stopped halfway? Which step? They took your call but the money never got moved?
"Never finalized..." meaning they stopped halfway? Which step? They took your call but the money never got moved?
Re: Vanguard never finalized a Roth recharacterization - next steps
Next step? This is a deal breaker. They have gotten so poor on executing simple things and the customer service is not good. Have Vanguard fix it and then move to Fidelity or Schwab
Re: Vanguard never finalized a Roth recharacterization - next steps
I never had any of these problems in 36+ years with Vanguard.
Only Vanguard can make corrections, so I honestly don’t understand how we can help you. Shouldn’t you provide your evidence which demonstrates that Vanguard made an error?
Why are you amending a 2019 tax return if you did nothing wrong?
Only Vanguard can make corrections, so I honestly don’t understand how we can help you. Shouldn’t you provide your evidence which demonstrates that Vanguard made an error?
Why are you amending a 2019 tax return if you did nothing wrong?
"I started with nothing and I still have most of it left."
- bertilak
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Re: Vanguard never finalized a Roth recharacterization - next steps
Perhaps if we knew what that "simple thing" was ...
May neither drought nor rain nor blizzard disturb the joy juice in your gizzard. -- Squire Omar Barker (aka S.O.B.), the Cowboy Poet
Re: Vanguard never finalized a Roth recharacterization - next steps
Great points, I'll call and ask for a supervisor.
She stated that I completed the initial portion but didn't esign the form. She stated the form was sent to me after I requested it be moved, but it was only put in my messages folder.
I told her that is unreal that something that critical would only be a message when I log into my account, which is about once a year. I always read the horror stories on Vanguard customer service, I am not experiencing it first hand. Pretty appalling how they do things there....I suppose if you don't have an issue like this they're ok, but once you have to actually involve them to do anything other than put money in an account they truly lack.
She stated that I completed the initial portion but didn't esign the form. She stated the form was sent to me after I requested it be moved, but it was only put in my messages folder.
I told her that is unreal that something that critical would only be a message when I log into my account, which is about once a year. I always read the horror stories on Vanguard customer service, I am not experiencing it first hand. Pretty appalling how they do things there....I suppose if you don't have an issue like this they're ok, but once you have to actually involve them to do anything other than put money in an account they truly lack.
Re: Vanguard never finalized a Roth recharacterization - next steps
Well for me, it was opening an IRA. Registration was fine but when it came time to transfer money, I received an error message that said that my transaction didn't go through and to try again. After trying multiple times with the same message, I created a Fidelity account and opened an IRA there with no issues. Well, next day I get an email saying Vanguard has received my funds or something to that extent . So the error message was wrong, the funds did go through, and not only that, now I've over contributed. I then had to call Vanguard and they couldn't even find my account or see that the money had transferred. It did, it left my bank account. Had to call back the next day and they finally took care of it. I then removed all of my accounts from Vanguard and opened elsewhere. I do like their mutual funds and ETF's though, just not their out of date platform and poor customer service. This was a few years ago
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Re: Vanguard never finalized a Roth recharacterization - next steps
Ummm….mx711yam wrote: ↑Tue Jul 13, 2021 1:08 pm Great points, I'll call and ask for a supervisor.
She stated that I completed the initial portion but didn't esign the form. She stated the form was sent to me after I requested it be moved, but it was only put in my messages folder.
I told her that is unreal that something that critical would only be a message when I log into my account, which is about once a year. I always read the horror stories on Vanguard customer service, I am not experiencing it first hand. Pretty appalling how they do things there....I suppose if you don't have an issue like this they're ok, but once you have to actually involve them to do anything other than put money in an account they truly lack.
I don’t think this is a Vanguard issue, it’s your responsibility to follow up, confirm and make sure the forms are properly signed.
Sucks, but many of my life-lessons also sucked.
WoodSpinner
WoodSpinner
Re: Vanguard never finalized a Roth recharacterization - next steps
Totally agree. This is your fault.WoodSpinner wrote: ↑Tue Jul 13, 2021 1:13 pmUmmm….mx711yam wrote: ↑Tue Jul 13, 2021 1:08 pm Great points, I'll call and ask for a supervisor.
She stated that I completed the initial portion but didn't esign the form. She stated the form was sent to me after I requested it be moved, but it was only put in my messages folder.
I told her that is unreal that something that critical would only be a message when I log into my account, which is about once a year. I always read the horror stories on Vanguard customer service, I am not experiencing it first hand. Pretty appalling how they do things there....I suppose if you don't have an issue like this they're ok, but once you have to actually involve them to do anything other than put money in an account they truly lack.
I don’t think this is a Vanguard issue, it’s your responsibility to follow up, confirm and make sure the forms are properly signed.
Sucks, but many of my life-lessons also sucked.
WoodSpinner
That said, Vanguard has a lot of leeway to backdate trades and correct errors. I would call them and get their perspective.
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Re: Vanguard never finalized a Roth recharacterization - next steps
Not valid without signature. Like many other important documents in life.
Re: Vanguard never finalized a Roth recharacterization - next steps
inverter wrote: ↑Tue Jul 13, 2021 1:15 pmTotally agree. This is your fault.WoodSpinner wrote: ↑Tue Jul 13, 2021 1:13 pmUmmm….mx711yam wrote: ↑Tue Jul 13, 2021 1:08 pm Great points, I'll call and ask for a supervisor.
She stated that I completed the initial portion but didn't esign the form. She stated the form was sent to me after I requested it be moved, but it was only put in my messages folder.
I told her that is unreal that something that critical would only be a message when I log into my account, which is about once a year. I always read the horror stories on Vanguard customer service, I am not experiencing it first hand. Pretty appalling how they do things there....I suppose if you don't have an issue like this they're ok, but once you have to actually involve them to do anything other than put money in an account they truly lack.
I don’t think this is a Vanguard issue, it’s your responsibility to follow up, confirm and make sure the forms are properly signed.
Sucks, but many of my life-lessons also sucked.
WoodSpinner
That said, Vanguard has a lot of leeway to backdate trades and correct errors. I would call them and get their perspective.
I agree should have watched it more closely, but when I spoke to the rep the same day of the recharacterization request I was told it was good to go and nothing further was needed. I assumed that meant what he said.
- bertilak
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Re: Vanguard never finalized a Roth recharacterization - next steps
duplicate
Last edited by bertilak on Tue Jul 13, 2021 1:30 pm, edited 1 time in total.
May neither drought nor rain nor blizzard disturb the joy juice in your gizzard. -- Squire Omar Barker (aka S.O.B.), the Cowboy Poet
- bertilak
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Re: Vanguard never finalized a Roth recharacterization - next steps
misunderstood who I was quoting!
Last edited by bertilak on Tue Jul 13, 2021 4:26 pm, edited 2 times in total.
May neither drought nor rain nor blizzard disturb the joy juice in your gizzard. -- Squire Omar Barker (aka S.O.B.), the Cowboy Poet
Re: Vanguard never finalized a Roth recharacterization - next steps
Tell a supervisor that. Tell them to pull the call recording. Escalate until they fix it.mx711yam wrote: ↑Tue Jul 13, 2021 1:22 pminverter wrote: ↑Tue Jul 13, 2021 1:15 pmTotally agree. This is your fault.WoodSpinner wrote: ↑Tue Jul 13, 2021 1:13 pmUmmm….mx711yam wrote: ↑Tue Jul 13, 2021 1:08 pm Great points, I'll call and ask for a supervisor.
She stated that I completed the initial portion but didn't esign the form. She stated the form was sent to me after I requested it be moved, but it was only put in my messages folder.
I told her that is unreal that something that critical would only be a message when I log into my account, which is about once a year. I always read the horror stories on Vanguard customer service, I am not experiencing it first hand. Pretty appalling how they do things there....I suppose if you don't have an issue like this they're ok, but once you have to actually involve them to do anything other than put money in an account they truly lack.
I don’t think this is a Vanguard issue, it’s your responsibility to follow up, confirm and make sure the forms are properly signed.
Sucks, but many of my life-lessons also sucked.
WoodSpinner
That said, Vanguard has a lot of leeway to backdate trades and correct errors. I would call them and get their perspective.
I agree should have watched it more closely, but when I spoke to the rep the same day of the recharacterization request I was told it was good to go and nothing further was needed. I assumed that meant what he said.
In the event you are wrong, the recording will also show that.
Re: Vanguard never finalized a Roth recharacterization - next steps
After almost a MONTH of fighting with them, I finally got a call today. I had requested the call be reviewed and was told by the rep it had and I was in error and they refused to release the call to me. I told her there is no way I screwed this up.nalor511 wrote: ↑Tue Jul 13, 2021 8:00 pmTell a supervisor that. Tell them to pull the call recording. Escalate until they fix it.mx711yam wrote: ↑Tue Jul 13, 2021 1:22 pminverter wrote: ↑Tue Jul 13, 2021 1:15 pmTotally agree. This is your fault.WoodSpinner wrote: ↑Tue Jul 13, 2021 1:13 pmUmmm….mx711yam wrote: ↑Tue Jul 13, 2021 1:08 pm Great points, I'll call and ask for a supervisor.
She stated that I completed the initial portion but didn't esign the form. She stated the form was sent to me after I requested it be moved, but it was only put in my messages folder.
I told her that is unreal that something that critical would only be a message when I log into my account, which is about once a year. I always read the horror stories on Vanguard customer service, I am not experiencing it first hand. Pretty appalling how they do things there....I suppose if you don't have an issue like this they're ok, but once you have to actually involve them to do anything other than put money in an account they truly lack.
I don’t think this is a Vanguard issue, it’s your responsibility to follow up, confirm and make sure the forms are properly signed.
Sucks, but many of my life-lessons also sucked.
WoodSpinner
That said, Vanguard has a lot of leeway to backdate trades and correct errors. I would call them and get their perspective.
I agree should have watched it more closely, but when I spoke to the rep the same day of the recharacterization request I was told it was good to go and nothing further was needed. I assumed that meant what he said.
In the event you are wrong, the recording will also show that.
The call today finally came after I had messaged them numerous times demanding the call be released. The rep told me they had made an error and on the call it was clear the rep said everything was done and nothing further was needed. He then told me to call their retirement line and advise them of the situation and he would handle it.
I called them, and the rep said that it was on the client rep who contacted me to do this. So now I'm waiting for a call back from him tomorrow to finalize this.
I'm shocked that I was lied to by the prior rep who told me she had in fact listened to the call and I screwed up. She then refused to release the call, and refused to allow me to speak to a manger. I'm now surprised that their in house guys don't even know the method to fix this mistake. Vanguard service is almost dangerous at this point.
Re: Vanguard never finalized a Roth recharacterization - next steps
Super glad to hear they are going to fix it for you. Hound them until it's done, just like you have been.
Re: Vanguard never finalized a Roth recharacterization - next steps
Sorry about your experience. I had a similar experience where Vanguard screwed up. My advice: take your money elsewhere, and get a bonus for it. I continue to hold Vanguard funds (ETFs), but it's becoming clear that Vanguard the brokerage is pretty much the worst place (of the low-cost brokerages) to hold them. E*Trade, Schwab, Fidelity, Merrill Edge - all are better.mx711yam wrote: ↑Wed Aug 04, 2021 5:00 pm After almost a MONTH of fighting with them, I finally got a call today. I had requested the call be reviewed and was told by the rep it had and I was in error and they refused to release the call to me. I told her there is no way I screwed this up.
The call today finally came after I had messaged them numerous times demanding the call be released. The rep told me they had made an error and on the call it was clear the rep said everything was done and nothing further was needed. He then told me to call their retirement line and advise them of the situation and he would handle it.
I called them, and the rep said that it was on the client rep who contacted me to do this. So now I'm waiting for a call back from him tomorrow to finalize this.
I'm shocked that I was lied to by the prior rep who told me she had in fact listened to the call and I screwed up. She then refused to release the call, and refused to allow me to speak to a manger. I'm now surprised that their in house guys don't even know the method to fix this mistake. Vanguard service is almost dangerous at this point.
Re: Vanguard never finalized a Roth recharacterization - next steps
Wow that is disturbing. SEC / FINRA???
Re: Vanguard never finalized a Roth recharacterization - next steps
Yeah currently looking into moving everything to fidelity, i have my hsa there already and I've been very impressed.02nz wrote: ↑Wed Aug 04, 2021 5:35 pmSorry about your experience. I had a similar experience where Vanguard screwed up. My advice: take your money elsewhere, and get a bonus for it. I continue to hold Vanguard funds (ETFs), but it's becoming clear that Vanguard the brokerage is pretty much the worst place (of the low-cost brokerages) to hold them. E*Trade, Schwab, Fidelity, Merrill Edge - all are better.mx711yam wrote: ↑Wed Aug 04, 2021 5:00 pm After almost a MONTH of fighting with them, I finally got a call today. I had requested the call be reviewed and was told by the rep it had and I was in error and they refused to release the call to me. I told her there is no way I screwed this up.
The call today finally came after I had messaged them numerous times demanding the call be released. The rep told me they had made an error and on the call it was clear the rep said everything was done and nothing further was needed. He then told me to call their retirement line and advise them of the situation and he would handle it.
I called them, and the rep said that it was on the client rep who contacted me to do this. So now I'm waiting for a call back from him tomorrow to finalize this.
I'm shocked that I was lied to by the prior rep who told me she had in fact listened to the call and I screwed up. She then refused to release the call, and refused to allow me to speak to a manger. I'm now surprised that their in house guys don't even know the method to fix this mistake. Vanguard service is almost dangerous at this point.
At this point I'm just looking to get them to fix their mistake and get over to fidelity. Sadly i can only imagine how many people vanguard does this too each year.
Re: Vanguard never finalized a Roth recharacterization - next steps
Or the lack of traditional signature was wrongly used as an excuse by Vanguard. I’ve never understood how they decide when a “real” signature is required and when voice authorization is sufficient. As a general matter, voice authorization can be the equivalent of a signature; if it’s an option, it seems to fit with the rest of the business model.inverter wrote: ↑Tue Jul 13, 2021 1:15 pmTotally agree. This is your fault.WoodSpinner wrote: ↑Tue Jul 13, 2021 1:13 pmUmmm….mx711yam wrote: ↑Tue Jul 13, 2021 1:08 pm Great points, I'll call and ask for a supervisor.
She stated that I completed the initial portion but didn't esign the form. She stated the form was sent to me after I requested it be moved, but it was only put in my messages folder.
I told her that is unreal that something that critical would only be a message when I log into my account, which is about once a year. I always read the horror stories on Vanguard customer service, I am not experiencing it first hand. Pretty appalling how they do things there....I suppose if you don't have an issue like this they're ok, but once you have to actually involve them to do anything other than put money in an account they truly lack.
I don’t think this is a Vanguard issue, it’s your responsibility to follow up, confirm and make sure the forms are properly signed.
Sucks, but many of my life-lessons also sucked.
WoodSpinner
That said, Vanguard has a lot of leeway to backdate trades and correct errors. I would call them and get their perspective.
I’m glad the OP didn’t accept the excuse and wasn’t cowed by the apologists.
“Under the Electronic Signatures in Global and National Commerce (ESIGN) Act and common law in the United States, voice signatures are legally enforceable with the addition of certainty of terms. The certainty of terms documents that both contracting parties accept “I Agree” statements. In order to be binding, the voice signature needs to be attached to the contract. A standard solution is to embed the digital voice recording in the contract and use encryption to prevent the files from being disassociated or altered.”
https://whatis.techtarget.com/definitio ... -signature
Re: UPDATED RESOLUTION - Vanguard never finalized a Roth recharacterization - next steps
After over a year of dealing with this, Vanguard finally reimbursed me funds over their debacle. I will say they are beyond incompetent, have too few people dealing with things, and don't know who should deal with what. This should not have taken a year to be resolved and they actually tried to say it was my fault until I complained to their corporate level and they pulled the call and had no option but to admit their wrongdoing.
Icing on the cake is the reimbursement to pay the tax man is considered taxable income to vanguard, so they had to add extra to cover my "earned income" from them this year
Icing on the cake is the reimbursement to pay the tax man is considered taxable income to vanguard, so they had to add extra to cover my "earned income" from them this year
Re: UPDATED RESOLUTION - Vanguard never finalized a Roth recharacterization - next steps
But I guess they didn't compensate you for your time to deal with all this.
Re: UPDATED RESOLUTION - Vanguard never finalized a Roth recharacterization - next steps
Other than paying you, what is the status of correcting the Roth excess contribution for 2020, or has that been done? You would owe 6% excise taxes for 2020 and 2021 (Form 5329), unless the 2020 contribution was not excess. Your 2020 return would also need amendment if CPA reported a TIRA contribution due to recharacterization that never occurred. It is not clear whether any 2020 excess Roth could be applied to 2021 or not. It depends on what contributions you made to either TIRA or Roth IRA for 2021.mx711yam wrote: ↑Thu Jun 23, 2022 8:55 am After over a year of dealing with this, Vanguard finally reimbursed me funds over their debacle. I will say they are beyond incompetent, have too few people dealing with things, and don't know who should deal with what. This should not have taken a year to be resolved and they actually tried to say it was my fault until I complained to their corporate level and they pulled the call and had no option but to admit their wrongdoing.
Icing on the cake is the reimbursement to pay the tax man is considered taxable income to vanguard, so they had to add extra to cover my "earned income" from them this year
If you made a 2021 contribution, you could have it removed, and probably it has losses instead of gains. That would clear the deck for applying the 2020 excess to 2021 and save you the 2021 excise tax. But you can only do this if you either filed your 2021 return on time or filed an extension for 2021.
At the end of the day, VG may or may not have reimbursed your direct tax costs and resulting tax prep charges in full. Who knows how they calculated your reimbursement check, which will be taxable income for 2022 as you indicated.
Re: UPDATED RESOLUTION - Vanguard never finalized a Roth recharacterization - next steps
Yeah they didn’t compensate for time and they should have this was a nightmare. They gave me enough to cover what the CPA submitted to correct this with the irs to include penalties etc. I’m just happy to be done with them, they are beyond incompetent and frustrating.
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Re: UPDATED RESOLUTION - Vanguard never finalized a Roth recharacterization - next steps
Wow, I am really impressed.mx711yam wrote: ↑Thu Jun 23, 2022 8:55 am After over a year of dealing with this, Vanguard finally reimbursed me funds over their debacle. I will say they are beyond incompetent, have too few people dealing with things, and don't know who should deal with what. This should not have taken a year to be resolved and they actually tried to say it was my fault until I complained to their corporate level and they pulled the call and had no option but to admit their wrongdoing.
Icing on the cake is the reimbursement to pay the tax man is considered taxable income to vanguard, so they had to add extra to cover my "earned income" from them this year
Yeah, that was my experience too.
I will sheepishly admit I caved (not on a Roth recharacterization but just their not having done what the trade confirmation said they had) without the nice resolution you got. I was dealing with a large taxable account though and became fearful they would close the account at their discretion when I challenged them. It wasn't well received.
It's too bad you can't post in the "why stay at Vanguard?" thread **. It got locked but one big take away was many feel that Vanguard scores big in trust.
I'll mark this in the "don't trust Vanguard to review calls accurately" and "get a copy" category.
I mean sure they told you it was done, it turns out someone wanted the signature, they sent a message and you didn't see it. Mistakes happen. But for them to "review the call" and claim it didn't happen that way -- it's just like any other business trying to get away with what they can. There's no special level of 'trust' there.
Kudos to Vanguard for correcting it in the end, but that's not really acting like a company I can really trust that much.
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