Sentences with phrase «total nondeductible»
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.
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Additionally, there is some evidence that people tend to be more cautious with their healthcare spending in general when they have a high - deductible plan, even for nondeductible costs, so employers are trying to slow the total spending.
If you made nondeductible contributions to your IRA, you must calculate your RMD based on the total balance, but your taxable income may be reduced proportionately for the after - tax contributions.
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.
If you made nondeductible contributions to your IRA, you must calculate your RMD based on the total balance, but your taxable income may be reduced proportionately for the after - tax 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.