@Pattmark11 wrote:
Does the non-deductible IRA portion of the Traditional IRA function more or less like a Roth IRA, except that you can't isolate it but merely prorate it? Should I get in the habit of getting end of year numbers in case I want to get a distribution the following year, or is the basis based on the original ratios in 2018... noticed I don't get 5498s identifying FMV at year end unless I make a contribution for that year. Your responsiveness is amazing, and you are quite the asset to this community!
The non-deductible amount called "basis" simply reduces would would be the taxable amount for ANY Traditional IRA distribution in proportion to the years distribution and the total year end value of all existing Traditional IRA accounts.
For example, if in 2020 you take a $5,000 distribution and your basis is $3,000 and the total December 31, 2020 year end value of all IRA's is $50,000, then the taxable amount would be $4,727 and the non-taxable amount due to the basis $273, leaving $2,727 of the basis remaining for future distributions.
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
