Contributions always come out of Roth IRA's in a specific order. See Publication 590, page 67: "Ordering rules for distributions".Since the dollars went in after tax, only gains in an IRA (or conversions) are taxable when taken in a nonqualified distribution.In my example there would be a $5k contribution, and a $6k distribution of past contributions, reducing the cost basis within the Roth. That distribution would be completely tax free.this is not a contribution removal of any sort, it is a contribution and then a distribution. Perhaps you missed that there is already a cost basis in the account of $20k.
Best Of |
Favorites & Replies |
Start a New Board |
My Fool |
BATS data provided in real-time. NYSE, NASDAQ and NYSEMKT data delayed 15 minutes.
Real-Time prices provided by BATS. Market data provided by Interactive Data.
Company fundamental data provided by Morningstar. Earnings Estimates, Analyst Ra