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Old 12-11-2012, 08:07 PM
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Setup IRA's a few year ago and didn't file

I setup a couple of IRA's with one financial institution about 3-4 years ago but didn't file state or federal tax forms and claim the income reduction. The feds and state had more than enough in my automated tax payments and haven't bothered. Now that I'm getting my things in order, my two questions are:

Probably I'm past the deadlines to receive refunds of over payment of taxes. Should I still file and if I do, would it be 1040 or 1040X (new return or amended return)?

Secondly, since I didn't claim reduction of taxable income in those years, what do I need to do to change my simple IRA's to Roth IRAs?

Thank you in advance for the advice.



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Old 12-12-2012, 03:09 AM
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“Probably I'm past the deadlines to receive refunds of over payment of taxes. Should I still file and if I do, would it be 1040 or 1040X (new return or amended return)?”--->Under the statute of limitations, the IRS has three years to give you a refund,( for claiming refunds and credits) as the later of: Two years from the date the tax was paid OR three years to audit your tax return, and ten years to collect any tax due. This is measured from the original deadline of the tax return, plus three years. For example, your 2009 tax return is due on April 15th, 2010. Add three years to this filing deadline, and you have until April 15th, 2013, to file your 2009 tax return and still get a tax refund. If you file your 2009 return after April 15th, 2013, then your refund "expires." It goes away forever because the statute of limitations for claiming a refund has closed. If you already filed a tax return, you can claim any additional refunds by sending in corrections with an amended return. Amended returns claiming additional refunds must be filed with the IRS before the SOL expires three years from the original April 15th due date.

“Secondly, since I didn't claim reduction of taxable income in those years, what do I need to do to change my simple IRA's to Roth IRAs?”--> You can convert your traditional IRA to a Roth IRA by rollover ---> A distribution from a traditional IRA then contributed to a Roth IRA within 60 days after distribution; trustee-to-trustee transfer ->The financial institution holding your traditional IRA assets will provide directions on how to transfer those assets to a Roth IRA with another financial institution; same trustee transfer ---------------> The financial institution holding your traditional IRA assets will provide directions on how to transfer those assets to a Roth IRA. In this case, the transfer occurs within the same financial institution.A conversion results in taxation of any untaxed amounts in the traditional IRAs contributions to R-Ira are after tax dollars. Regardless of the type of IRA you choose, the Federal government imposes annual contribution limits.You need to contact your financial institution to set up an IRA conversion. You will need to provide your account information, as well as the information for the R-IRA that the money will be transferred to. Wait to file your taxes until you receive a form 1099-R that shows that amount of the conversion. You should complete form 8606, part II, to determine the taxable amount of the conversion. Since you’d make nondeductible contributions to the traditional IRA, the entire amount will be taxable.You need to r eport the total amount of your conversion on either line 11a if you use Form 1040A or 15a if you use form 1040. Report the taxable portion on line 11b of Form 1040A or 15b of Form 1040. Only the taxable portion will be included when your income is totaled.



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Old 06-20-2016, 07:29 PM
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Revisiting old traditional IRA

So I was past the deadline to receive any refunds. Since both my IRA's ended up being funded with income that was fully taxed, is it possible to re-categorize these to Roth without paying tax again and if so, how?
Thank you.



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Old 06-20-2016, 08:17 PM
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Originally Posted by rmk9785e View Post
So I was past the deadline to receive any refunds. Since both my IRA's ended up being funded with income that was fully taxed, is it possible to re-categorize these to Roth without paying tax again and if so, how?
Thank you.
basically you need to contact your retirement plan admin for more accurate professional help/advice ;however, you can convert your eligible IRA assets to a Roth IRA regardless of income or marital status; remember, generally, converted assets in the R-IRA must remain there for at least 5 years to avoid penalties and taxes. Distributions from a R-IRA are tax-free and penalty-free provided that the 5-year aging requirement has been satisfied and You reach age 59?;or You pass away;or You become disabled; orYou make a qualified first-time home purchase.



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Old 08-08-2016, 03:59 PM
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Originally Posted by Wnhough View Post
basically you need to contact your retirement plan admin for more accurate professional help/advice ;however, you can convert your eligible IRA assets to a Roth IRA regardless of income or marital status; remember, generally, converted assets in the R-IRA must remain there for at least 5 years to avoid penalties and taxes. Distributions from a R-IRA are tax-free and penalty-free provided that the 5-year aging requirement has been satisfied and You reach age 59?;or You pass away;or You become disabled; orYou make a qualified first-time home purchase.
Thanks you for proving information about how long R-IRA must remain there to avoid penalties and taxes but it doesn't answer my question of "Since both my IRA's ended up being funded with income that was fully taxed, is it possible to re-categorize these to Roth without paying tax again and if so, how?"



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Old 08-08-2016, 04:23 PM
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Quote:
Originally Posted by Wnhough View Post
basically you need to contact your retirement plan admin for more accurate professional help/advice ;however, you can convert your eligible IRA assets to a Roth IRA regardless of income or marital status; remember, generally, converted assets in the R-IRA must remain there for at least 5 years to avoid penalties and taxes. Distributions from a R-IRA are tax-free and penalty-free provided that the 5-year aging requirement has been satisfied and You reach age 59?;or You pass away;or You become disabled; orYou make a qualified first-time home purchase.
Thank you for advice on how long converted assets must remain there to avoid penalties or taxes. I'll appreciate a response to my question of "Since both my IRA's ended up being funded with income that was fully taxed, is it possible to re-categorize these to Roth without paying tax again and if so, how?"



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Old 08-09-2016, 12:56 PM
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Since both my IRA's ended up being funded with income that was fully taxed, is it possible to re-categorize these to Roth without paying tax again====>>correct; I guess it depends.Recharacterizing an IRA basically means undoing an IRA conversion and putting the funds back into a traditional IRA. A roth-ira recharacterization lets you reverse a R- IRA conversion by moving the assets back into a traditional IRA. If you made a conversion of a traditional IRA to a R- IRA, or contributed to either one, you can switch the type of IRA by doing a recharacterization through October 15 of the year after you made the original conversion or contribution. The recharacterization allows you to treat the conversion as if it never happened, or the contribution as if it was made to the correct type of IRA in the first place. You can use it to save on taxes, or to correct a contribution that you discovered later you were not allowed to make. The most common tax saving occurs if you converted a traditional IRA to a Roth

and if so, how?"===========>>>I am not a retirement plan expert as aid you need t contact an admin for more accurate info in detail.



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