This is a hypothetical but will be helpful to learn how this might be handled, for a beginner like me.
Let's say I open an after-tax IRA and fund it with $10,000 of my own after-tax money. Or similarly, I buy $10,000 worth of stock with my own after-tax money.
After a a few weeks, I see the value is now $11,000. So I sell the stock and/or close the IRA.
They send me a disbursement of $11,000.
At tax time, I know they report that I received $11,000. I understand that part. But does this same documentation also note that I started with $10,000 of my own money?
My profit is only $1,000, so how do I let the IRS know that my income was only $1,000, if the document shows a disbursement of $11,000. Thanks!
