Jump to content

roth converted 2 years ago, now over 59.5, is distribution taxable?


JHalligan

Recommended Posts

100% of the ira was converted to roth, and taxes were paid. Now, a partial distribution is happening, but the 5-year clock has not been satisfied, making it a non-qual distribution. I think jsut the earnings are taxable, but, can he specify return of capital and not touch earnings, making it a tax-and penalty-free distribution?

Link to comment
Share on other sites

My understanding of ROTH-IRA distributions is that basis is recovered first so if the partial distributions is less than the basis there would be no taxes due since participant is over 59 1/2. If partial withdrawal exceeds the basis recovery the earnings would be taxable as you don't meet the qualified ROTH distributions since it is less than 5 years.

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
×
×
  • Create New...