Author Topic: Closed acc  (Read 883 times)

WES

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Closed acc
« on: February 04, 2021, 01:44:58 PM »
I closed my LC account in early 2018. In early 2020, I discovered that LC never processed the close request. They sent me a check for the balance, and I submitted a second close request in February 2020.

This week, I got a "your 1099-B is available" email. That was to be expected for any recoveries in Jan & Feb of 2020. But I discovered that they have continued to credit my account with recovery amounts, as recently as seven months after the account was closed.

The rep insists the account is closed, and he "guesses the tax department just did things a little differently this year," whatever that means.  ??? He's mailing me a check for the few dollars recovered.

Anyone else have this happen?

My bet is that this happens again for 2021.

AcaciaRose

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Re: Closed acc
« Reply #1 on: February 04, 2021, 02:23:45 PM »
Almost the same thing happened to me. I closed my LC account in November 2019, withdrawing my balance and signing the closure form stating I forfeited any future returns. I had no further transactions with Lending Club.

This week, I got the '1099-B is available' email WES mentions. I logged in and saw a 1099-B saying I received around $75 in recovery amounts. My account is definitely closed, as I was unable to see anything else except statements and tax forms. Obviously, I never received the $75, but the IRS will expect me to report it when I file my taxes.

Grrr. I hope they'll issue a corrected 1099-B.

WES

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Re: Closed acc
« Reply #2 on: February 09, 2021, 05:18:01 PM »
AcaciaRose -- you'll need to phone customer service. They will mail you a check for the balance in your account.

rj2

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Re: Closed acc
« Reply #3 on: February 12, 2021, 04:08:32 PM »

This is interesting. I have been wondering what will happen to recoveries--sounds like even if you close your account they may pay recoveries to you anyway via a check.

My account is an IRA, so I wonder if that changes things. Getting a check from an IRA is a distribution, which is not what I want right now.

Rob L

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Re: Closed acc
« Reply #4 on: February 13, 2021, 09:43:26 AM »
If you get a distribution check I think you have up to 60 days to deposit it into an identical type IRA and it's no longer a distribution.

LA87654

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Re: Closed acc
« Reply #5 on: February 13, 2021, 10:47:48 PM »
Getting a check from an IRA is a distribution....
Yup, this reminds me of the old Abraham Lincoln quote about the internet....

AcaciaRose

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UPDATE Re: Closed acc
« Reply #6 on: February 15, 2021, 12:21:58 PM »
Lending Club didn't respond to my emails, so I called this morning and spoke to a helpful person who said they'll send me a check. I'll go ahead and report the 1099-B on my 2020 taxes.

Before I called, I logged in and saw a January 2021 statement showing a few more dollars in recoveries, so I can expect another 1099-B for the 2021 year.  (I can login and see statements and tax forms, but can't transfer money, change my address, etc.)

Background:
I had a taxable investing account, not an IRA. I sold all my notes on Folio in May 2019. A few recoveries trickled in during the next few months, and to avoid getting 1099-Bs for a few dollars in future years, in November 2019 I signed and submitted Lending Club's "Investment Account Closure Request Form - Taxable" "forfeiting all rights to all Notes, including any and all Notes in 'charge-off' status" by mailing a hard copy to their Market St address and emailing them a copy. In November 2019 I received an email confirmation from a Lending Club staffer that they had processed the form and my account was closed.

After I reported the 2019 amounts on my taxes a year ago, I thought I was done with Lending Club. I heard no more from them until a couple of weeks ago when I received the email that my 2020 tax forms were ready.

I hope my account is finally closed. Wish me luck!

rj2

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Re: Closed acc
« Reply #7 on: February 17, 2021, 05:50:26 PM »
I looked through recoveries in the activity section, and noticed that while most are for loans that charged off between 6-12 months ago, there were a few from as far back as 3 years--and that was just in one 20 day period so it's possible you could see recoveries from even longer ago. Obviously over time the number of recoveries diminishes, but if they don't close the account you could see a small amount income reported for a few years.

AcaciaRose

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Re: Closed acc
« Reply #8 on: March 17, 2021, 01:27:05 PM »
As mentioned above, I called Lending Club on February 15 and was assured that they would send me a check for the recoveries in my account that they had reported on the 1099-B form. Since then I've had no calls, no emails, and no check from them. Absolutely nothing. I logged into the site today and found February's statement saying I now have a balance of $103.

I wonder what I have to do to get them to close the account and send me a check? Complain to the SEC or maybe a California state agency? The amount involved is too small to warrant a lawyer, but I'm willing to spread the word of their incompetence on social media.

AcaciaRose

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Re: Closed acc
« Reply #9 on: April 05, 2021, 08:05:10 PM »
One final update: Today I received a check in the mail from Lending Club for the accrued recoveries for 2020 and the first three months of 2021. There was no accompanying letter, but I am no longer able to login to LC, so I assume my account is truly closed.

Thanks for listening to my rants! Good luck to you all.