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Question-Mark1
New Member

How do I remove a IRA contribution that did not qualified without being taxed on a distribution?

 
4 Replies
macuser_22
Level 15

How do I remove a IRA contribution that did not qualified without being taxed on a distribution?

What year was the contribution for?

 

If 2020, then if you filed your 2020 on time before May 17,2021   you have until Oct 15, 2021 to have the contribution *and any earnings* as a "return of contribution" (not an ordinary distribution), then only the earnings will be taxable.

**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.**
Question-Mark1
New Member

How do I remove a IRA contribution that did not qualified without being taxed on a distribution?

The contribution was made in 2021 but for the 2020 tax year.

The 2020 return was filed on time.

Thank You

macuser_22
Level 15

How do I remove a IRA contribution that did not qualified without being taxed on a distribution?


@Question-Mark1 wrote:

The contribution was made in 2021 but for the 2020 tax year.

The 2020 return was filed on time.

Thank You


You have until the due date (or extended due date) of the 2020 tax return to get the return of contribution plus earnings.   Filing on time gives you an automatic extension to Oct 15, 2021.

**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.**
fanfare
Level 15

How do I remove a IRA contribution that did not qualified without being taxed on a distribution?

If you took a deduction for an IRA contribution that you are reversing, you have to file an amended return.

You can add also the "amount of earnings" with that if you are acting timely.

the custodian must calculate the earnings.

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