Do IRA contributors in 2009 need to know 2005-6 contribution limits & catch-up amts?

[PauletteGoddard]

Hi:

For six years I have been a client of a major US discount brokerage firm, entrusting it with my taxable account, Roth IRA accounts, Coverdell account, and 401(k) rollover noncontributory account.

In 2009, I'm wondering what the business value or proposition to customers is by having the following verbiage on online Deposit forms:

"Traditional IRA/Roth IRA -- Limit of $4000 for tax year 2005 and 2006. If you were fifty (50) years of age or older in 2005 you are eligible to make an additional $500 "catch-up" contribution for 2005. If you are or will be fifty (50) years of age or older in 2006 you are eligible to make an additional $1000 contribution for 2006."

Before I dismiss my discount brokerage for being so clueless or lacking in resources to initiate a ticket to update or eliminate this information, and transfer my funds to a better discount brokerage who will pay attention to my customer questions, I'd like to know:

Does your discount brokerage have this verbiage on its IRA deposit forms?
Is there something so critical about the tax years 2005 and 2006 that does not apply to 2007 or 2008 for catch-up contributions? Something that the discount brokerage call center people can't talk to me about because the topic isn't on their scripts?

[MonkeyMama]

Hi:

Before I dismiss my discount brokerage for being so clueless or lacking in resources to initiate a ticket to update or eliminate this information, and transfer my funds to a better discount brokerage who will pay attention to my customer questions, I'd like to know:

Um, the answer is they are clueless & they haven't updated the info in a few years.

This would sum up pretty much any brokerage, discount or not. I am not surprised, and can't think of anywhere where you would be better off.

I always cringe when people/clients rely on tax forms issued by their mutual fund companies and brokerages. Ugh. & even when we have to get involved to ask for corrections, it's usually like talking to a brick wall. So yeah, my reliance on any such outfit for accurate tax information, in any form, would be a big fat 0.

[poundwise]

That's pitiful and inexcusable. They haven't updated this info on their site for 3 years!?!? Wow.

No, there is no reason beyond incompetence for this.

[disneysteve]

I suppose it could have been an innocent mistake and someone pasted in an old file accidentally when doing an update. I can't imagine they've had that on their site for 3 years without anyone pointing it out to them. I'd shoot them an e-mail. Could be that everyone looks at it and realizes it is wrong but nobody ever told the company. People are like that.

[MonkeyMama]

I'd put my money on plenty of people have told them, but who ever is in charge of that hasn't gotten the message. It's really hard to reach anyone intelligent at any of those places.

Can you tell I have had a few negative experiences?

[PauletteGoddard]

I may pull my money out then. It's not a matter of reaching someone intelligent. It's a matter of reaching someone who cares about her company's image and customer retention. It doesn't take intelligence to pass along a request to someone who can and will actually act on it.

I have asked the brokerage firm, monthly, for ten months, to remove or change the verbiage. I actually thought it went away, after I had an e-mail conversation, but the verbiage returned. I wonder if it's because I used a different browser. The Customer Service Representative pointed to a PDF, when I had included the URL (it's dynamically generated, so the verbiage is in some script). The PDF doesn't have the verbiage, but an outside user can't access the PDF: the user is directed to 'Accounts' tab, then 'Deposit/Withdraw' link, then goes to a form with web-based custom controls.

I don't see customer value in having outdated information.
If they can't summon the resources to remove the script (I could do it in less than a minute, with permissions to code files), I have to assume they aren't doing well financially or they are lazy. I could handle laziness if there were self-service options, or if it wasn't a negative impression to have four-year-old time-sensitive text on a file.

For comparison, I sent an e-mail to the Federal Reserve Board webmaster pointing out a 404 error stemming from a stalle artifact banner. The webmaster fixed it and thanked me, and gave me new URLs pointing to what I may have been looking for.

But I should give them a second try, then check out the top brokerages according to Kiplinger's. It looks like financial companies have given up earning our trust. It was probably easier for them back in the day when the CEO of then-Providian, the company that would sit on credit card payments until they were late so as to rack up fees, was appointed to Ethics Commissioner.

[simpletron]

IRS audits is the reason why those forms are still around. you have to keep the last 3 years of tax returns. So it would be reasonable for 2005 though 2009 forms to exist somewhere, so when one of their clients get audited they can recreate everything if they lost it. of course, the default form should be either 2008 or 2009 and only 2009 forms after april 15.

[blankcheck]

Just check with them first. If it's a lack of an update, it means that they're lazy. If it was a fluke, no harm.