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Vanguard Deposit Recoding Sample Letter

Posted By Jim On 03/29/2006 @ 5:56 pm In Investing,Retirement | 1 Comment

I made a mistake in my contribution to my SEP-IRA two days [3] when I deposited the maximum as an employer and then an additional $600 as an employee. When you deposit as an employee, it’s treated as a deposit to a Traditional IRA and thus subject to the $4,000 cap. No big deal except that cap is for the aggregate of your Traditional and Roth IRA contributions, I already deposited the full four thousand into my Roth IRA so I was over the contribution limit. This is a big no-no.


With Vanguard, the solution was to get the $600 deposit recoded from a 2005 employee contribution to a 2006 employer contribution and that required a letter. While there is no sample letter on Vanguard’s site, I’ve created one in case anyone ever needs to send Vanguard this type of letter. It contains all the important details that they instructed me to include and should be adequate.

[DATE]
Vanguard Group
Attention: Small Business Services
P.O. Box 1106
Valley Forge, PA 19482-1106

To Whom It May Concern:

Please recode the $XXXX deposit made to my SEP-IRA on XX/XX/XX from an 2005 employee contribution to a 2006 employer contribution. The account number of the SEP-IRA is XXXXXXXXXXX and the funds were deposited into fund 0056 (STAR Fund).

Please contact me if there are additional questions at (XXX) XXX-XXXX.

Hopefully no more screwups on my part.


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[2] Email: mailto:?subject=http://www.bargaineering.com/articles/vanguard-deposit-recoding-sample-letter.html

[3] my contribution to my SEP-IRA two days: http://www.bargaineering.com/articles/primer-on-self-employment-taxes-or-why-sep-iras.html

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