2014 is almost here, but we wanted to open the Slott Report Mailbag one last time to answer some pressing year-end retirement planning questions, as well as several issues with decisions that will come in the new year. Click to read this week's Q&A with our IRA Technical Expert.
It is year-end. Retirement account owners and beneficiaries are grappling with required distributions for 2013 and, in some cases, with missed distributions from prior years. When there is a missed distribution, we constantly get the question, “Do I have to do an amended tax return?” The answer is, “No.”Distributions from retirement accounts are taxable to the recipient in the year in which the funds come out of the account. Read more for some examples.
"Don't Let the IRS Gobble Up Your IRA," yet if you listen to the national newspaper article we read yesterday, that's exactly what the IRS will do. This article's author makes major mistakes, using the wrong IRA minimum distribution table in his example, using the wrong percentage when talking about required distributions from your IRA balance and more.
IRS Private Letter Ruling 201342017 is a ruling that involved a Ponzi scheme in an IRA. An IRA owner we will call "Alex" asserted that his failure to complete his IRA rollover within the 60-day rollover window was because his financial adviser engaged in a Ponzi scheme.
Ed Slott and Company IRA Technical Consultant Jeffrey Levine lays out 3 different ways you can give to charity in 2013, how charitable giving can help you at tax time and key strategies to take advantage of before the end of the year. It's December, so with that in mind, we lay out 3 ways you can give to charity in 2013.
Not only are the holidays upon us, but it is time to make sure that required distributions (RMDs) from retirement plans are taken before year end (or before the cutoff date imposed by the IRA custodian). One question that comes up frequently is what RMDs can be added together. We answer this in detail below.
This week's Slott Report Mailbag answers questions about inherited IRAs and naming a trust as the beneficiary of employer plan retirement assets. This to read a Q&A with our IRA Technical Expert.
Whenever you receive an IRA distribution, you have 60 days from the day you receive it to roll it over, tax-free, to another IRA. The failure to complete a rollover within 60 days means the funds aren't eligible for rollover, and that means the IRA distribution will be taxable to you. Also, if you’re under age 59 ½ at the time, the 10% early distribution penalty will apply. But in some cases, you can get more time to complete a tax-free rollover.
Private Letter Ruling 201347025 is an IRS first when it comes to the 60-day rollover rule. A taxpayer we will call "Ron" asserted that his failure to accomplish IRA rollovers within the 60-day rollover window was due to inaccurate advice from an IRS agent. Click to find out what happened to Ron.
For IRA distribution purposes, all IRAs (except Roth IRAs) are considered one big giant IRA. It doesn’t matter if you have one IRA that was rolled over from a former employer, and one SEP IRA with your current employer, and one contributory IRA where you put annual contributions, and one after-tax IRA where you put contributions for which you do not take a deduction. All four IRAs will be considered one IRA any time you take a distribution.
