$1.86 check from 401k I closed earlier

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Husker_in_KC
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Joined: Thu Aug 17, 2017 7:48 am

$1.86 check from 401k I closed earlier

Post by Husker_in_KC »

So closed out my 401k account from where I worked and rolled it all to Vanguard. I got some kind of distribution after the fact for $2.32, the 401k provider pulled out 20% or $0.46 the check is for $1.86. Is it worth the effort to send to Vanguard or just cash it and deal with taxes, especially with taxes everything get rounded to the dollar.

Cheers
now Husker_in_CO.
rkhusky
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Re: $1.86 check from 401k I closed earlier

Post by rkhusky »

Husker_in_KC wrote: Fri Jan 14, 2022 12:44 pm So closed out my 401k account from where I worked and rolled it all to Vanguard. I got some kind of distribution after the fact for $2.32, the 401k provider pulled out 20% or $0.46 the check is for $1.86. Is it worth the effort to send to Vanguard or just cash it and deal with taxes, especially with taxes everything get rounded to the dollar.
Only you can say whether it is even worthwhile to cash.

But if you are the type that likes to get everything squared to the penny, you would want to look into "indirect rollovers". See e.g., https://www.bogleheads.org/wiki/IRA_rol ... _transfers. You would cash and send $2.32 from your banking account to your Vanguard IRA. Not sure exactly how it shows up on your tax forms. Presumably your 401k provider sent the $0.46 to the IRS, which should count against your tax bill, and will send you some notice of that. Otherwise, it doesn't seem like it should affect your taxes further.
gtd98765
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Re: $1.86 check from 401k I closed earlier

Post by gtd98765 »

Several years ago I moved some investments from USAA to Vanguard. At the end of the month USAA deposited 7 cents accrued interest in the account, which effectively kept it open. I called USAA and asked them to just close the account and forget the 7 cents. They said they would need me to get a document notarized to do so. I gave up at that point.
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samsoes
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Re: $1.86 check from 401k I closed earlier

Post by samsoes »

Cash it, and enjoy it! :mrgreen:
You don't have to worry about the 10% penalty, because that rounds down to $0!
"Happiness Is Not My Companion" - Gen. Gouverneur K. Warren. | (Avatar is the statue of Gen. Warren atop Little Round Top @ Gettysburg National Military Park.)
Cicero123
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Re: $1.86 check from 401k I closed earlier

Post by Cicero123 »

I left my employer, and moved my 401k to Schwab. At about the same time, my former employer moved the 401k account and administration to Fidelity. I had an HSA at Fido, and when I logged in, I discovered a similar situation—there was a 401k at Fidelity with a balance of a little over $2 connected to my former employer. I called and asked them to just send me a check. The rep thought there might be a $25 fee to send a check, but wasn’t sure. I told him to keep the money if there was. I never saw a check, and now when I log in to Fidelity, I can see they just took the $2 for themselves. And I don’t care. I just didn’t want a loose end of an account out there.
lstone19
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Re: $1.86 check from 401k I closed earlier

Post by lstone19 »

I can do one better. A year or two after I retired, my former employer changed HSA administrators so even though I was retired and had closed my old HSA under them (rolled to Fidelity), they opened one for me and funded it with $0.01 to keep it open. And for the next year, I would receive a snail mailed statement every quarter. Finally to get it to stop, I submitted a reimbursement request for the $0.01 (ACH) and that put an end to it (and no, they never did send a 1099-SA for the one cent - I guess the $10 de minimus rule applies to that too).
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sunnywindy
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Re: $1.86 check from 401k I closed earlier

Post by sunnywindy »

With compounding, your pound of spaghetti will turn into a pint of fancy beer. Mail the check.
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Stinky
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Re: $1.86 check from 401k I closed earlier

Post by Stinky »

My advice -

Cash the check
Treat yourself to a sausage biscuit at McDonald’s
Keep the change

Life is too short to tie yourself in knots over trivialities like this.
Former life insurance company financial officer who sincerely believes that ”It’s a GREAT day to be alive!”
inbox788
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Re: $1.86 check from 401k I closed earlier

Post by inbox788 »

gtd98765 wrote: Sat Jan 15, 2022 9:48 am Several years ago I moved some investments from USAA to Vanguard. At the end of the month USAA deposited 7 cents accrued interest in the account, which effectively kept it open. I called USAA and asked them to just close the account and forget the 7 cents. They said they would need me to get a document notarized to do so. I gave up at that point.
Notarized for 7 cents? LOL.
sunnywindy wrote: Sun Jan 16, 2022 5:15 pm With compounding, your pound of spaghetti will turn into a pint of fancy beer. Mail the check.
I've been using a stash of forever stamps, so I lost track of how much first class postage is these days. Don't know when they raised it from $0.55 to $0.58. That's more than 30% of the cost of the deposit, not to mention the cost of the envelope, and time to mail it. And don't forget the gas if you drive to the post office. You might need to downgrade to regular beer. :sharebeer

But seriously, aren't you allowed to cash the check (mobile deposit) and make and electronic transaction into the Rollover IRA? I believe it's the amount has to be deposited, not the actual funds that came from the physical check.

https://www.wickhamservices.com/2020/03 ... ion-check/
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