Advisor Flipbooks

© SEI 2022 For Intermediary Use Only. Do Not Distribute. 13 1065) directly for an IRA. If for some reason you have a client who receives a Schedule K-1 (Form 1065) for an IRA, the form should be sent to: SEI Private Trust Company Attn: Leveraged Tax Reporting One Freedom Valley Drive Oaks, PA 19456 If an IRA is invested in or recently sold a Schedule K-1 (Form 1065) generating asset that had reportable income, SPTC will perform a review to identify Unrelated Business Taxable Income (UBTI) in excess of $1,000. If UBTI is determined to be in excess of $1,000 in the IRA for the taxpayer, SPTC will calculate the applicable tax and take the necessary steps to pay the tax from the IRA (as required by the Internal Revenue Code), remit the tax to the IRS, and file the requisite 990T tax forms on behalf of the taxpayer. SPTC will pay this tax from the client's IRA directly; this tax payment is not considered a taxable or reportable distribution. If your client closed their SPTC IRA but owes a 990T tax liability for 2022, SPTC will still file the 990T on their behalf. However the client is responsible for paying the tax liability. SPTC will send a letter to the last known address explaining this process to the IRA holder. C. If I have clients who are invested in a Schedule K-1 (Form 1065) generating asset, the sales are reported on both the 1099-B issued by SPTC and the K-1 issued from the asset. Does this mean it is being double-reported to the IRS? No. The K-1 sales schedule is a disposition worksheet sent by the asset directly to the end investor that contains information needed to calculate the gain or loss of the unit disposition. The asset does not report the sale information on the K-1 to the IRS. Sales are reported to the IRS by SPTC on the 1099-B form. The cost basis is listed as unknown, as the investors will need the information from the K-1 to appropriately determine the gain or loss from sales. D. Will SPTC mail other compliance or regulatory information directly to my clients? Yes. By February 1, 2023, SPTC will postmark the following information to your clients who are participants in IRA custodied at SPTC: Fair Market Value (FMV) for the IRA as of December 31, 2022. 2023 Required Minimum Distribution Notification for IRA participants who have attained age 73 by December 31, 2023. Both of these documents will be part of the 5498 mailing and will not be sent as separate documents. 9. Individual Retirement Accounts (IRAs) A. Does a Traditional/SEP/SIMPLE IRA owner need to take a Required Minimum Distribution for 2023? If the owner of a Traditional IRA, SEP IRA, or SIMPLE IRA is already older than 73 in 2023, they have already begun taking RMD's and must continue doing so. The deadline to withdrawal their RMD is 12/31/2023. If the owner of a Traditional IRA, SEP IRA, or SIMPLE IRA turned 72 in 2022, they will need to take a Required Minimum Distribution (RMD) for 2022. Since this is the first year they are required to take an RMD they have until April 1 2023 to disburse the funds. Note that if an IRA owner takes all or part of their 2022 RMD in 2023, they will still have to separately take a 2023 RMD by 12/31/2023. The withdrawals in 2023 would be reported for tax year 2023 on a 1099R, even if part of the distribution was for a 2022 RMD. SPTC will notify IRA owners in January if they are required to take an RMD as part of the 5498 Fair Market Value mailing. The specific RMD amount is not provided on the mailing but SPTC will provide this calculation online for all IRA's. You can find the RMD computation and annual RMD tracking on www.SEIAdvsiorCenter.com under the 'Business' tab 'RMD's. Investors can find this information on www.AccessMyPortfolio.com and https://Investor.SEI-Connect.com.

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