I have stocks that I sold last year which I've originally thought of as my IRA investment until I received a form 1099-B for it this year. Having the mind set then that it was an IRA money, I rolled it into my bank which I opened an IRA account for it specifically.
My question is what do I need to do to reconcile this money without getting penalized with tax multiple times? To be clear, I'm going to pay tax for the gain I made, but I also get taxed for putting the same money into an IRA account, is this normal? I mean I've already paid capital gains tax, so what is the best course for me to take without getting a double whammy on tax? Do I have a way out?
your first problem is that if it wasn't an IRA account, did you report income in the prior years on your 1040.
in which year did you put the money into the IRA a/c 2019 or 2020?. if 2019, were you eligible to contribute? if so, do you want to contribute for that year? if yes do you want to take a deduction, make it a non-deductible contribution or do you prefer a ROTH? if yes, how much was in the account and what was the amount transferred?
or is your situation that you already made the max IRA contribution and also transferred this taxable a/c into your IRA a/c? what year?
