Question

Hello, i made a rollover ira account thinking i would roll money into it from a 401k never did it. I just put money out of my check each week into it. Would i owe taxes?

Forum|Forum|3 years ago
December 15, 2022
2 replies
0 views

The money i put into this ira is post tax money. So it is already taxed, will i owe taxes on it again or no

TurboTax Premier Online

M

Mike9241

your statements seem to be contradictory so please clarify exactly what you did

i made a rollover ira account thinking i would roll money into it from a 401k never did it

The money i put into this ira is post tax money.

fanfare

Employee

You don't pay tax on money contributed to an IRA.

You will pay a yearly penalty if you make a contribution for which you are not eligible.

@rhodesjulian-out

D

dmertz

Employee

Your deposits constitute regular IRA contributions that must be reported on your tax return either as deductible contributions (with the deduction effectively converting the contributions into pre-tax money) on Schedule 1 line 20 or on Form 8606 as nondeductible (after-tax) contributions. If you have basis in nondeductible traditional IRA contributions, subsequent distributions will consist of a proportionate mix of nontaxable (after-tax) money and taxable (pre-tax money). If you have not reported on Form 8606 any nondeductible contributions, any distribution from your traditional IRAs will be entirely taxable.

R

rhodesjulian-outAuthor

All the money i have put into this rollover ira has been post tax money. Its already been taxed coming out of my pay check.

D

dmertz

Employee

As I said, it becomes pre-tax money by virtue of the tax deduction that you receive for the contributions. If you instead report the contributions on Form 8606 as nondeductible contributions, only then does it become after tax money in your traditional IRAs.