Roth IRA, Traditional IRA, 401K » after http://www.iraroth.net IRA Questions and Answers Tue, 17 Jan 2012 00:09:43 +0000 en hourly 1 http://wordpress.org/?v=3.3.1 Is an excess Roth IRA contribution taxable when withdrawing it after the tax filing deadline with extension? http://www.iraroth.net/2011/02/is-an-excess-roth-ira-contribution-taxable-when-withdrawing-it-after-the-tax-filing-deadline-with-extension-2/ http://www.iraroth.net/2011/02/is-an-excess-roth-ira-contribution-taxable-when-withdrawing-it-after-the-tax-filing-deadline-with-extension-2/#comments Fri, 25 Feb 2011 22:26:35 +0000 admin http://www.iraroth.net/2011/02/is-an-excess-roth-ira-contribution-taxable-when-withdrawing-it-after-the-tax-filing-deadline-with-extension-2/ Question by pkmoney555: Is an excess Roth IRA contribution taxable when withdrawing it after the tax filing deadline with extension?
I contributed $ 6000 to a Roth IRA in 2006, which caused an excess of $ 2000. It is now after the tax-filing deadline with extension. I know that there is a 6% excise tax penalty already. My question is: Are there any taxes if I withdraw the $ 2000? And would the early distribution penalty 10% apply since I am under 59 1/2?

Best answer:

Answer by MukatA
No you only pay 6% excise tax. No other penatly. Here if the information:

In general, if the excess contributions for a year are not withdrawn by the date your return for the year is due (including extensions), you are subject to a 6% tax. You must pay the 6% tax each year on excess amounts that remain in your traditional IRA at the end of your tax year. The tax cannot be more than 6% of the value of your IRA as of the end of your tax year.

In general, you must include all distributions (withdrawals) from your traditional IRA in your gross income. However, if the following conditions are met, you can withdraw excess contributions from your IRA and not include the amount withdrawn in your gross income.

Total contributions (other than rollover contributions) for 2006 to your IRA were not more than $ 4,000 ($ 5,000 if you are 50 or older).
You did not take a deduction for the excess contribution being withdrawn.
The withdrawal can take place at any time, even after the due date, including extensions, for filing your tax return for the year.

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]]> http://www.iraroth.net/2011/02/is-an-excess-roth-ira-contribution-taxable-when-withdrawing-it-after-the-tax-filing-deadline-with-extension-2/feed/ 1 How long did it take Congress after starting tax-free IRAs to tax them and how long will it take Congress to? http://www.iraroth.net/2010/05/how-long-did-it-take-congress-after-starting-tax-free-iras-to-tax-them-and-how-long-will-it-take-congress-to/ http://www.iraroth.net/2010/05/how-long-did-it-take-congress-after-starting-tax-free-iras-to-tax-them-and-how-long-will-it-take-congress-to/#comments Mon, 03 May 2010 13:06:09 +0000 admin http://www.iraroth.net/2010/05/how-long-did-it-take-congress-after-starting-tax-free-iras-to-tax-them-and-how-long-will-it-take-congress-to/ tax our 401(k) retirement accounts and other retirement accounts into oblivion? Should we allow this and trust Congress to do what is best for us and the country, or should we take other action in our “democracy”?

http://www.investmentnews.com/apps/pbcs.dll/article?AID=/20081007/REG/810079894

]]> http://www.iraroth.net/2010/05/how-long-did-it-take-congress-after-starting-tax-free-iras-to-tax-them-and-how-long-will-it-take-congress-to/feed/ 9 Can you continue to convert an IRA to a Roth IRA after the new rules take effect in 2010 (beyond 2010)? http://www.iraroth.net/2009/12/can-you-continue-to-convert-an-ira-to-a-roth-ira-after-the-new-rules-take-effect-in-2010-beyond-2010/ http://www.iraroth.net/2009/12/can-you-continue-to-convert-an-ira-to-a-roth-ira-after-the-new-rules-take-effect-in-2010-beyond-2010/#comments Tue, 22 Dec 2009 03:05:43 +0000 admin http://www.iraroth.net/2009/12/can-you-continue-to-convert-an-ira-to-a-roth-ira-after-the-new-rules-take-effect-in-2010-beyond-2010/ http://www.iraroth.net/2009/12/can-you-continue-to-convert-an-ira-to-a-roth-ira-after-the-new-rules-take-effect-in-2010-beyond-2010/feed/ 1 Is an excess Roth IRA contribution taxable when withdrawing it after the tax filing deadline with extension? http://www.iraroth.net/2009/12/is-an-excess-roth-ira-contribution-taxable-when-withdrawing-it-after-the-tax-filing-deadline-with-extension/ http://www.iraroth.net/2009/12/is-an-excess-roth-ira-contribution-taxable-when-withdrawing-it-after-the-tax-filing-deadline-with-extension/#comments Tue, 01 Dec 2009 02:48:52 +0000 admin http://www.iraroth.net/2009/12/is-an-excess-roth-ira-contribution-taxable-when-withdrawing-it-after-the-tax-filing-deadline-with-extension/ I contributed $6000 to a Roth IRA in 2006, which caused an excess of $2000. It is now after the tax-filing deadline with extension. I know that there is a 6% excise tax penalty already. My question is: Are there any taxes if I withdraw the $2000? And would the early distribution penalty 10% apply since I am under 59 1/2?

]]> http://www.iraroth.net/2009/12/is-an-excess-roth-ira-contribution-taxable-when-withdrawing-it-after-the-tax-filing-deadline-with-extension/feed/ 3 How should I invest my 401K if I intend to leave my current company after 1 year? http://www.iraroth.net/2009/11/how-should-i-invest-my-401k-if-i-intend-to-leave-my-current-company-after-1-year/ http://www.iraroth.net/2009/11/how-should-i-invest-my-401k-if-i-intend-to-leave-my-current-company-after-1-year/#comments Sun, 29 Nov 2009 20:22:56 +0000 admin http://www.iraroth.net/2009/11/how-should-i-invest-my-401k-if-i-intend-to-leave-my-current-company-after-1-year/ So, if I intend to leave my current company in a year & move my 401K into another 401K or IRA option, does it make sense to just keep everything in a money market fund? Would I have to stay with the same funds for 5 or more years to reap any benefits from the stock market? Thanks.

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