Tax Implications for a late contribution to Roth IRA? | TigerDroppings.com
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kennypowers816
LSU Fan
Houston
Member since Jan 2010
2215 posts

Tax Implications for a late contribution to Roth IRA?

I haven't made my max contribution to my Roth IRA for 2012. I'd like to make a late contribution, but I want to double check the tax return implications (or presumably lack thereof).

Since the money has already been taxed and is going into a Roth, am I correct in assuming this has absolutely zero tax implications for me? I wouldn't need to wait for any updated forms from my bank/broker after the late contribution to be able to file my tax return, would I? It shouldn't have an effect on taxable income, right?


tigeraddict
LSU Fan
Baton Rouge
Member since Mar 2007
4977 posts

re: Tax Implications for a late contribution to Roth IRA?
as long as the Roth account was open on or before December 2012, you have until April 15th the make a contribution up to $5k.



kennypowers816
LSU Fan
Houston
Member since Jan 2010
2215 posts

re: Tax Implications for a late contribution to Roth IRA?
Roth IRA has been open since 2007 or so I believe. I know I can make the contribution before 4/15.

My questions is... can I file my tax return now and then make my Roth contribution subsequently? I expect I should be able to because the Roth contribution has no effect on my taxable income, etc., right?


foshizzle
LSU Fan
Washington DC metro
Member since Mar 2008
31458 posts
Online

re: Tax Implications for a late contribution to Roth IRA?
quote:

can I file my tax return now and then make my Roth contribution subsequently? I expect I should be able to because the Roth contribution has no effect on my taxable income, etc., right?


Yep. You contribute to a Roth with post-tax money, so you can't claim it on your return anyway.


LSUchuck
LSU Fan
Member since Dec 2004
1444 posts

re: Tax Implications for a late contribution to Roth IRA?
Yes. Just tell your tax preparer next year you contributed to it afterwards so the amount can be added to your Roth basis. You can take losses on Roth accounts but it's part of the 2% misc. itemized deduction.


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Lsut81
USA Fan
Member since Jun 2005
65874 posts

re: Tax Implications for a late contribution to Roth IRA?
quote:

as long as the Roth account was open on or before December 2012, you have until April 15th the make a contribution up to $5k.




I just opened my Vanguard account last week and they let me max out my 2012 contribution


Teddy Ruxpin
LSU Fan
New Orleans, LA
Member since Oct 2006
21607 posts

re: Tax Implications for a late contribution to Roth IRA?
quote:

I just opened my Vanguard account last week and they let me max out my 2012 contribution


Ya, you can open it before April 15 and contribute to the taxable year. I didn't do it because I was barely going to max out 2012 any ways so I didn't see the point of contributing to 2011. Of course take advantage of it if you can.
This post was edited on 1/31 at 3:09 pm


Lsut81
USA Fan
Member since Jun 2005
65874 posts

re: Tax Implications for a late contribution to Roth IRA?
quote:

Ya, you can open it before April 15 and contribute to the taxable year. I didn't do it because I was barely going to max out 2012 any ways so I didn't see the point of contributing to 2011. Of course take advantage of it if you can.


Maxed out 2012 and about to max out 2013 within the next week... Gotta figure where to put money for the rest of the year


Teddy Ruxpin
LSU Fan
New Orleans, LA
Member since Oct 2006
21607 posts

re: Tax Implications for a late contribution to Roth IRA?
quote:

Maxed out 2012 and about to max out 2013 within the next week... Gotta figure where to put money for the rest of the year


I'm guessing your 401k is fully funded (up to match, but if you got 17,000, congrats!) throughout the year from paycheck to paycheck?

I opened an HSA to give me another tax advantaged account to fill up. You got/can get one of those? That's another 3,250 a year you can stash and invest pretty freely depending on what bank you choose.

After that, I believe you just have to open a regular taxable investment account. I don't really know the options for people really raking it in. At that point I suppose you may have to shift your tax efficient assets into the taxable account, and vice versa. But don't depend on me for that stuff.
This post was edited on 1/31 at 4:24 pm


Lsut81
USA Fan
Member since Jun 2005
65874 posts

re: Tax Implications for a late contribution to Roth IRA?
quote:

I'm guessing your 401k is fully funded (up to match, but if you got 17,000, congrats!) throughout the year from paycheck to paycheck?


Current employer doesn't have a 401k just yet, so thats why my money is beginning to pile up


Teddy Ruxpin
LSU Fan
New Orleans, LA
Member since Oct 2006
21607 posts

re: Tax Implications for a late contribution to Roth IRA?
quote:

Current employer doesn't have a 401k just yet, so thats why my money is beginning to pile up


Yet? As in at all? Or that you aren't eligible? Thats a bummer.

If you don't have an HSA you should open one up since you can use that as a "stealth" IRA.

After that, I guess you'd have to get a taxable investment account but I'm not a money wiz like the folks here.
This post was edited on 1/31 at 5:35 pm


Lsut81
USA Fan
Member since Jun 2005
65874 posts

re: Tax Implications for a late contribution to Roth IRA?
quote:

Yet? As in at all? Or that you aren't eligible? Thats a bummer.


Yeah, were a small operation, but the goal is to have a 401k in place by end of the first quarter.

quote:

If you don't have an HSA you should open one up since you can use that as a "stealth" IRA.



Unfamiliar with this, please explain...

I had an HSA at my old job that was fully funded by the company. Pretty much had free medical care bc I used to to pay my doctors co-pays and prescriptions


Teddy Ruxpin
LSU Fan
New Orleans, LA
Member since Oct 2006
21607 posts

re: Tax Implications for a late contribution to Roth IRA?
Wikipedia - Health Savings Accounts

Stealth IRA

I didn't read the article above, but I assumed with the title "Stealth IRA" it was about what I'm talking about.

Only thing I noticed off the top is it isn't guaranteed you can fund the HSA with pre-tax dollars. My employer only allows me to contribute post-tax dollars. You'll have to check your employer on that.

And as I said, for an individual, you can max contribute 3,250 a year for 2013.
This post was edited on 1/31 at 5:52 pm


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foshizzle
LSU Fan
Washington DC metro
Member since Mar 2008
31458 posts
Online

re: Tax Implications for a late contribution to Roth IRA?
quote:

If you don't have an HSA you should open one up since you can use that as a "stealth" IRA.


Teddy Ruxpin
LSU Fan
New Orleans, LA
Member since Oct 2006
21607 posts

re: Tax Implications for a late contribution to Roth IRA?
quote:

foshizzle


You fully quoted my post. I feel validated.


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