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DAF contribution timing woes

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  • nachos31 nachos31 
    Moderator
    Status: Physician
    Posts: 416
    Joined: 01/12/2016

    So I opened and contributed to a Fidelity DAF for 2018 with my last contribution submitted on 12/28/18. Fidelity marked it as received (and sent me an email confirmation saying as much) on the same day so I assumed it counted for 2018 tax purposes. I knew this was cutting it close but my other contributions in 2018 were received AND settled the same the day I contributed, so I figured this would be same.

    However, looking back now, Fidelity states that while the contribution was received on 12/28/18, it was not settled until 1/2/19 and that’s the date they attributed per the confirmation letter–different from the email and which apparently counts as the official receipt for IRS purposes–which was not provided directly to me (stumbled across them incidentally which led me down this rabbit hole). While the “History” page for contributions simply states 12/28/19, a 2018 end of year report I can generate does not include this final contribution.

    I already filed my 2018 taxes several weeks back thinking this counted as a 2018 charitable deduction. I’m assuming I need to file an amended return now because of this date discrepancy and walk back this deduction? Super frustrating.

    #197392 Reply
    jfoxcpacfp jfoxcpacfp 
    Moderator
    Status: Financial Advisor, Accountant, Small Business Owner
    Posts: 6912
    Joined: 01/09/2016

    That is the danger of timing any kind of activity near the cutoff (including submitting paperwork to set up a solo-k). However, given that Fido states the contribution was received before the eoy, I would at least attempt to take your issue up the chain of command to see if you can persuade someone there who would be willing to change the date on the confirmation letter. It is a minor journal entry on their end and I am guessing they are far from closing out the books for 2018.

    If you cannot get satisfaction then, yes, you’ll need to amend your 2018 income tax return and hope you’re in an even higher tax bracket in 2019.

    Johanna Fox Turner, CPA, CFP, Fox Wealth Mgmt & Fox CPAs ~ 270-247-0555
    https://fox-cpas.com/for-doctors-only/

    #197436 Reply
    nachos31 nachos31 
    Moderator
    Status: Physician
    Posts: 416
    Joined: 01/12/2016

    That is the danger of timing any kind of activity near the cutoff (including submitting paperwork to set up a solo-k). However, given that Fido states the contribution was received before the eoy, I would at least attempt to take your issue up the chain of command to see if you can persuade someone there who would be willing to change the date on the confirmation letter. It is a minor journal entry on their end and I am guessing they are far from closing out the books for 2018.

    If you cannot get satisfaction then, yes, you’ll need to amend your 2018 income tax return and hope you’re in an even higher tax bracket in 2019.

    Click to expand…

    Talked with Fidelity. They said the date that matters it the date “received” and as long as that occurred in 2018 then it counts as a charitable contribution for IRS purposes. Their settlement date is simply processing the contribution and investing it per my allocation. Their confirmation letter does state both dates, so that is reassuring. Glad I don’t have to deal with an amended return and sending the IRS a check.

    #197879 Reply
    jfoxcpacfp jfoxcpacfp 
    Moderator
    Status: Financial Advisor, Accountant, Small Business Owner
    Posts: 6912
    Joined: 01/09/2016
    Splash Refinancing Bonus

    That is the danger of timing any kind of activity near the cutoff (including submitting paperwork to set up a solo-k). However, given that Fido states the contribution was received before the eoy, I would at least attempt to take your issue up the chain of command to see if you can persuade someone there who would be willing to change the date on the confirmation letter. It is a minor journal entry on their end and I am guessing they are far from closing out the books for 2018.

    If you cannot get satisfaction then, yes, you’ll need to amend your 2018 income tax return and hope you’re in an even higher tax bracket in 2019.

    Click to expand…

    Talked with Fidelity. They said the date that matters it the date “received” and as long as that occurred in 2018 then it counts as a charitable contribution for IRS purposes. Their settlement date is simply processing the contribution and investing it per my allocation. Their confirmation letter does state both dates, so that is reassuring. Glad I don’t have to deal with an amended return and sending the IRS a check.

    Click to expand…

    That is wonderful news, I’m so happy to hear that! Given that they will not be reporting anything to the IRS (as they would with setting up a 401k, for example), that makes sense.

    Johanna Fox Turner, CPA, CFP, Fox Wealth Mgmt & Fox CPAs ~ 270-247-0555
    https://fox-cpas.com/for-doctors-only/

    #197880 Reply
    Liked by nachos31
    PhysicianOnFIRE PhysicianOnFIRE 
    Moderator
    Status: Physician
    Posts: 1488
    Joined: 01/08/2016

    Good to hear you were able to clear that up. And thank you for your generosity! #jerkmove

    Cheers!
    -PoF

    40-something anesthesiologist and personal finance blogger @ https://physicianonfire.com [Part of the WCI Network] Find me on Twitter: @physicianonfire

    FIRE. Financial Independence. Retire Early.

    #197892 Reply

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