Sentences with phrase «of nondeductible»

Here's a list of some nondeductible expenses:

Most of the nondeductible expenses above show up under the «Other Expenses» section of the Schedule C or on the corporate tax returns.

But here you're conflating a Roth Conversion of a deductible IRA with a Backdoor Roth Conversion of nondeductible IRA money and the two are very different things.

Keep a record of all nondeductible IRA contributions — and make sure your heirs know where to find the details.

However, you'll still have to pay tax on amounts not considered a return of your nondeductible contributions.

Bear in mind that a traditional IRA has basis only to the extent of your nondeductible contributions.

Some people have traditional IRAs that consist mostly of nondeductible contributions.

Income tax is certainly due on the total amount of the distribution, less that part of the distribution that is a return of nondeductible post-tax contributions, if any, to the Traditional IRA.

A: If you convert the entire amount of all traditional IRAs you own, then the non-taxable part of your rollover distribution is simply the total amount of nondeductible contributions you made to all of those IRAs, less the amount of nontaxable distributions you received in the past.

Example: You have a traditional IRA with a balance of $ 10,000, which includes $ 6,000 of nondeductible contributions.

Because the aggregation rule makes the taxable distribution the same no matter which account you convert, you can't reduce the taxable distribution amount by converting an IRA with a larger proportion of nondeductible contributions.

One advantage of nondeductible IRA contributions is that the earnings are tax - deferred.

Not exact matches

Those who want to contribute annually to a Roth but exceed the income cap may also take advantage of a loophole in the tax law by doing a backdoor conversion, which entails contributing money to a traditional, nondeductible IRA each year and then immediately converting it into a Roth.

If I an correct, in traditional IRA, the basis, as in 8606, is the portion of the balance due to nondeductible contribution.

For that reason, the IRS (Internal Revenue Service) considers homeowners insurance premiums nondeductible payments, much like the cost of utilities or wages paid to domestic help.

Once you've paid off that debt, take the same amount of money and apply it to your next highest - rate debt and so on until your nondeductible debt is gone.

A more limited form of rate shifting is available with a regular, nondeductible IRA.

The need to save for a secure tomorrow, combined with the power of tax - deferred earnings, makes nondeductible IRA contributions a promising alternative for individuals no longer eligible for deductible IRA contributions.

If you exceed the income limits, you can still make the maximum annual contribution, but a portion or all of it will be considered a nondeductible contribution.

If you only have one traditional IRA, the amount of the distribution to be taxed equals the account balance on the conversion date minus any nondeductible contributions.

A Roth IRA allows you to receive tax - free distributions of your retirement funds in return for making nondeductible contributions now.

Once you make a nondeductible contribution to a Traditional IRA or rollover after - tax amounts, any distributions taken from the IRA will include a prorated amount of pre-tax and post-tax assets.

If he filed as an investor, the bulk of this interest expense would have been nondeductible because of the investment interest expense limitation.

If you convert only part of your traditional IRA, or if you have more than one traditional IRA and don't convert all of them, then the nontaxable part of your conversion distribution will be determined by a formula where the nontaxable percentage is the amount of your total nondeductible contributions (less any nontaxable distributions you previously received) divided by the total balance of all of your traditional IRAs.

A: Yes, but when you determine how much of your conversion distribution is taxable, you're required to treat all your traditional IRAs as if they were one big IRA, so you don't get any advantage if you take the distribution out of the IRA that has the most nondeductible contributions.

For example, if 60 % of your IRA balance comes from nondeductible contributions and you convert $ 8,000 of that IRA, you'll report $ 3,200 of income from the conversion (40 % of $ 8,000).

Q: How do I determine how much of my distribution is nontaxable if I made nondeductible contributions to one or more of my traditional IRAs?

FROM A TAX PERSPECTIVE, you can think of a tax - deferred variable annuity as similar to a nondeductible IRA.

If you also made nondeductible contributions to your IRAs, some of the amount won't be subject to income taxes.

A high wage earner can contribute to a nondeductible IRA with the sole intentions of converting it in 2010.

Once you make a nondeductible contribution or roll over after - tax amounts to any of your Traditional, SEP or SIMPLE IRA, any subsequent distributions from any of your Traditional, SEP or SIMPLE IRAs will include a prorated amount of pretax and post-tax assets, as these IRAs are aggregated for the purposes of determining the taxable amount of any distributions.

Once you make a nondeductible contribution or roll over after - tax amounts to any of your Traditional, SEP or SIMPLE IRA

Basis, also referred to as after - tax balances, accrue in retirement accounts from nondeductible contributions and rollovers of after - tax amounts to IRAs.

Each Fund is subject to a 4 % nondeductible excise tax on certain undistributed amounts of ordinary income and capital gain under a prescribed formula contained in Section 4982 of the Code.

These work somewhat like nondeductible IRA contributions: they permit tax - deferred buildup of investment earnings, and they create basis in the account so that the portion of your subsequent withdrawals representing these after - tax dollars will not be taxed again.

Note that withdrawals from deductible and nondeductible traditional IRAs are subject to ordinary income taxes and if withdrawn prior to age 59 1/2 may be subject to an additional 10 percent federal income tax penalty (for nondeductible traditional IRAs, only the portion of the withdrawal attributable to earnings is taxable).

Of that $ 20,000, $ 13,000 was taxable upon the conversion, and $ 7,000 was not because it came from nondeductible IRA contributions.

Naturally, if the trip was primarily for personal reasons, the entire cost of the trip is considered to be a nondeductible personal expense.

Below are some of the more common nondeductible business expenses that lawyers should be aware of.

But generally, if the principal purpose of the organization is to provide entertainment to its members, it is nondeductible.

Unfortunately, payments of any fines or penalties to the government are nondeductible from taxable income even if it was connected to a business purpose.

There are some business deductions that are nondeductible as a matter of law.

Will all of the attorney's fees related to the settlement be nondeductible?

There is one big exception: driving from home to your office (and vice versa) or another regular place of business is considered a nondeductible commuting expense.

For that reason, the IRS (Internal Revenue Service) considers homeowners insurance premiums nondeductible payments, much like the cost of utilities or wages paid to domestic help.

«If you make your contribution to the nondeductible traditional IRA and then leave it there until it accumulates sufficient investment income to exceed the full contribution amount before you convert it, you will have to reverse the excess amount of the conversion before the end of the year or face a fine from the Internal Revenue Service.

Or you can split your contributions between types of accounts, deductible and nondeductible.

If your trip was primarily for personal reasons, such as vacation, the entire cost of the trip is a nondeductible personal expense.