Roth IRA Distribution pre-59.5
I have a client that needs access to funds from their Roth IRA. We want to avoid any penalties or taxes, looking at contributions only, however she does not have accurate information on the contributions. The Roth was started in the mid 2000s and we can only get tax transcripts online dating back to 2011. We have tried mailing and faxing requests to the IRS for pre-2011 but still waiting.
So, couple questions…
1. Can you get that info from the IRS pre-2011
2. Is there a way to check the status of a request
3. Is there a better way to get that information and if not, how long should we expect to wait to get the information?
Thanks!!
Permalink Submitted by Alan - IRA critic on Thu, 2021-03-25 20:02
No way I know of.
The IRS is currently dealing with a massive backlog. I would not bother further with pre 2011 data.
Other possible sources include Roth custodian records if current custodian goes back that far, Forms 5498 if she kept them, client’s check registers, and client’s tax preparer if the current one goes back that far. If she ever took a prior Roth distribution, the 8606 for that year should show her basis as of that year.
If she finds partial contribution info, she could limit the distribution to the amount of contributions and any older conversions. If she did any conversions, she should remember and the tax returns for the last 5 years would show the taxable amount of any conversions subject to the 10% penalty if withdrawn under 5 years.
After making the best possible effort, she could make a reasonable guess for Roth contribution and conversion basis, then at least keep that figure on the 8606 updated until age 59.5.
Permalink Submitted by Brian Bishop on Thu, 2021-03-25 20:29
Awesome information. I always appreciate the response and information!!