Help with cost basis on Roth IRA non-qualified distribution
Hello,
I need some help understanding my rollover + non-qualified distribution to minimize my tax liability (if any) and not get flagged for doing something silly.
I had a Roth 401k with my previous job that I rolled over DIRECTLY to my Roth IRA. I received 2 1099Rs for this rollover.
1099R #1
X Total distribution
Box1: $12983 (gross)
Box2a: $12983 (taxable amount)
Box4: $2597 (tax withheld)
Box7: G (distr. code)
1099R #2
X Total Distribution
Box1: $17065 (gross)
Box2a: $0 (taxable amount)
Box4: $0 (taxable amount)
Box5: $13851 (employee contributions)
Box7: H (distr. code)
Box11: 2022 (year designated roth cont.)
Then, I had made a bunch of withdrawals due to personal issues (I do not meet the hardship criteria for these). This my 1099R from my Roth IRA for the distributions:
Box1: $39,800 (gross)
Box2b: X (taxable amount not determined)
Box4: $8756 (tax withheld)
Box7: J (distr. code)
I added up my cash contributions that I personally made PRIOR to 2024 to this Roth IRA and it came out to be $12,550.
Is it fair to say that my Roth IRA basis is the $12,550 + $13,851 (box5, contribution on 1099R #2) = $26,401?
Or am I going about this all wrong?
Comments
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Your direct, non-payroll contributions are tracked and reported annually on Form 5498 which is issued in May of each year. Make sure that the contribution amounts total the $12,550.
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Yes, those contributions add up to $12,550. But the question remains, do I count the contributions I did to my personal Roth IRA + the ones to my Roth 401k (which ended up being rolled over to my personal Roth IRA)?
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Yes. They would be combined since the Roth 401K was rolled over into your existing Roth IRA.
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Thank you. I had done my return (but not submitted) in TurboTax and it was showing up with an extra $3k in tax return. Had to do some googling and chatgpt. FreeTaxUSA wasn't clear when it came to a pre-tax 1099R to a Roth IRA rollover, so I was omitting the conversion basis (not the contribution).