dmertz
Level 15

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"The IRA was rolled eventually over to a 457b Plan."

 

Rolling over to a 457(b), 401(k), 403(b) or the federal TSP any basis in nondeductible traditional IRA contributions is not permitted.  If such a rollover is done and not corrected, as appears to be the case here, the basis is lost and the amount becomes taxable a second time.