• 0 Vote(s) - 0 Average
  • 1
  • 2
  • 3
  • 4
  • 5

IRA 60 day loan

#1
plan on taking a ira distribution in December 2018 and paying it back in January 2019 (ie. rollover) the money to pay it back is coming from a different ira distribution i assume that the December distribution would be non taxable but the January distribution would be taxable am i correct? basically, i need the money in December but want to avoid a taxable income event until January will this work
  Reply
#2
I think that you have to be over 59 1/2 to take an IRA distribution. As I understand it you can take a loan from a 401k and pay it back in 60 days but you better check.
  Reply
#3
As I understand it, you can take possession  of the funds (with the intention to transfer to a new custodian), and hold those funds for a max of 60 days or pay the early withdraw consequences.  The accord is complicated and dated per posting vs. physical transfer or post marks..  If true, be sure to give the window of at least one week for check clearing and then the posting, etc.  This must be done without a single flaw or you will pay.  If I was doing it, I would physically walk through the whole process and save all paper work/documentation with a one week liberty -just for peace of mind.
  Reply
#4
I think you can do that without penalty, even if funds are withdrawn and deposited back into the same account.  The IRS did tighten up the rules a while back however.
 
I believe that each taxpayer is limited to one rollover per calendar year  12-month period  between similar accounts, eg. from one T-IRA to a different or the same T-IRA.
 
The only catch I can see is that if you pull the funds in December, won't Fidelity generate a form 1099-R for 2018, which requires you to report the distribution on your 2018 federal return?
  Reply


Forum Jump:


Users browsing this thread: 1 Guest(s)