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January 8, 2025
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I have earned income in 2024. Can I withdraw ($8K) from my traditional IRA and move it to my Roth as my allowable contribution (allowing me to avoid tax).

  • January 8, 2025
  • 2 replies
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    Best answer by Opus 17

    Yes, but that does not avoid tax.  If you make a regular withdrawal from the IRA, it is subject to regular income tax plus a 10% penalty if you are under age 59-1/2.

     

    You can do a conversion (rollover) from the traditional IRA to the Roth IRA.  This does not count as a contribution, you still pay tax but you don't pay a penalty, and you get the money into the Roth.  Plus you can still make Roth contributions if you are eligible.

     

    There;s really no way to get money out of a traditional IRA without paying income tax, since you paid no tax on contributions or earnings.  The only way to not pay any tax on a traditional IRA withdrawal is for your total taxable income to be less than your standard or itemized deductions. 

    2 replies

    Opus 17Answer
    Employee
    January 8, 2025

    Yes, but that does not avoid tax.  If you make a regular withdrawal from the IRA, it is subject to regular income tax plus a 10% penalty if you are under age 59-1/2.

     

    You can do a conversion (rollover) from the traditional IRA to the Roth IRA.  This does not count as a contribution, you still pay tax but you don't pay a penalty, and you get the money into the Roth.  Plus you can still make Roth contributions if you are eligible.

     

    There;s really no way to get money out of a traditional IRA without paying income tax, since you paid no tax on contributions or earnings.  The only way to not pay any tax on a traditional IRA withdrawal is for your total taxable income to be less than your standard or itemized deductions. 

    VolvoGirl
    Employee
    January 8, 2025

    Were you maybe thinking if you took out of the IRA and paid the tax then put it in the ROTH you would get a deduction for the ROTH contribution so it would wash out the tax?