Discussion:Recording IRA balances
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Discussion Forum Index --> Basic Tax Questions --> Recording IRA balances
Discussion Forum Index --> Tax Questions --> Recording IRA balances
| 2 October 2007 | |
| Is it important to record balances in IRA accounts (not the basis, if any but just the balances)? My previous tax software did record this amount but the new software I plan to use does not. I'm not sure when this comes into play. Any thoughts? | |
| October 2, 2007 | |
| I don't know, Bob. Where would you record it? It only matters in 8606 situations, where the taxpayer has basis in the thing. Otherwise, I don't know if I care unless you're also doing financial planning. | |
| 2 October 2007 | |
| I don't routinely record it, although it is asked on the Pro Series organizer. It only comes into play, as JR said, on the 8606. It will come into play both for basis as well as for penalties for excess contributions (I have had two in the last week that had inelligible Roth conversions and/or excess IRA contributions that both resulted in penalties. The penalty calculation looks at the lesser of the excess contribution or the IRA balance). If the client is retired it may be helpful if you provide info on req'd min distributions as well. | |
| 2 October 2007 | |
| I also don't record the account values although I try to make note of what retirement accounts clients have (for future reference).
Speaking of 8606, if a taxpayer takes a non-qualified total distribution from one Roth IRA (consisting of basis + earnings), can the taxpayer aggregate other Roth IRAs and treat all such accounts as one? I've been looking into this but can't quite find a definite answer... | |
Death&Taxes (talk|edits) said: | 2 October 2007 |
| If your client moves to New Jersey, it would be very helpful to know his total of deductible and non-deductible contributions to IRAs for upon retirement, they provide basis in arriving at taxable income in the state. This is not the same thing as balances, and I must admit on a number of clients I've had for 20+ years, I had to go back and create such a summary when I shredded old years before I moved in 2003......are there any other states where this might play an impact? I recall that California in the early 80s used the pre-1982 rules on deducting IRAs but don't know if this impacts anything today. | |
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