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Author: progmtl Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 74759  
Subject: Roth IRA and Tax Return Date: 2/17/2000 5:46 PM
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I have a simple Roth IRA question, which someone can probably answer in a few words. When I began asking my discount broker about Roth IRAs, she actually told me that you can contribute pre-tax earnings, which I know to be false for Roths. I subsequently stopped asking her questions :).

My question is this: When you file a tax return (standard 1040), do you indicate on it somewhere what your Roth IRA contribution for the given year was?

I am inclined to guess that you do, which explains why you can still make a contribution for year X up until April 15th of the year X+1.

thanks,
progmtl
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Author: pauleckler Big funky green star, 20000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 19219 of 74759
Subject: Re: Roth IRA and Tax Return Date: 2/17/2000 8:43 PM
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I do not believe that you must indicate on your tax return that you have contributed to a Roth IRA. You do indicate if you contributed to a conventional IRA especially if some of the funds in the IRA are tax deductible and some are not. You also indicate if you withdrew money from Roth or conventional IRA.

Your broker may very well notify the IRS that you have made a contribution.

I do not see any indication that Roth IRA rules are strictly enforced at this time. However, the great fear is that IRS will decide to audit your account just as you retire and begin to take withdrawals. The worst would be if they decided it was unlawful and therefore earnings were not protected from income taxes in the years earned so you have to pay back taxes plus interest and penalties. This could mean no Roth IRA assets left. So its probably not worth taking chanches. Make an honest effort to follow the rules. Most of the time it will probably be OK.

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Author: progmtl Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 19221 of 74759
Subject: Re: Roth IRA and Tax Return Date: 2/17/2000 9:17 PM
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pauleckler,

Thanks very much for the quick reply. I will, of course, make an honest effort to follow the rules. The main reason I asked was to determine whether I had to wait to do my tax return after opening up a Roth IRA account.

Cheers,
progmtl

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Author: xnocturnal One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 19233 of 74759
Subject: Re: Roth IRA and Tax Return Date: 2/18/2000 11:40 AM
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progmtl asked
<<When you file a tax return (standard 1040), do you indicate on it somewhere what your Roth IRA contribution for the given year was?>>

Believe it or not but at this point there is no requirement to report your Roth contributions on your tax return. That may change in future years.

But since you are dealing with all mighty IRS
make sure you keep records of your yearly contributions

Regards,
xnocturnal

P.S. There is a site dedicated to ROTH IRAs. I believe it is www.rothira.gov

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Author: xnocturnal One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 19234 of 74759
Subject: Re: Roth IRA and Tax Return Date: 2/18/2000 11:48 AM
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oops, that site is www.rothira.com

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