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|Subject: Hate Form 8606 Calculations||Date: 4/13/2013 11:24 AM|
|Author: billjam||Number: 71980 of 76628|
Just my annual complaint about the IRS formula for determining how much of my non-deductible IRA contributions I can recover each year. After 13 years of IRA distributions I still have 60% of my non-deductible contributions left in the IRA. It happens that it also took me 13 years to make those contributions.
For 2012 I was able to claim 2.2% if my IRA distribution as recovery of non-deductible contributions. Based on the current total value of my IRA in 2013 only 2% will be allowed as recovery of non-deductible contributions. And if my investments continure to do well, which I hope they will so I don't run out of money, that percentage will get smaller in the future.
I understand Congress and IRS didn't want someone taking completely tax free distributions in any year. But the current calculation means you can never recover all your non-deductible unless you completely exhaust your IRA. When I'm 100 years old there will still be unrecovered non-deductible money in the IRA.
Something ought to be done to fix this but I don't see it happening. Not enough people in this situation and no interest by Congress or IRS in speeding up the recovery process. Heck, even Republicans don't give a damn about it.
Okay, done ranting for another year. Thanks for listening.
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