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    kpacnj's Avatar
    kpacnj Posts: 2, Reputation: 1
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    #1

    Apr 15, 2009, 04:03 PM
    Tax treatment of IRA W/D when returned to same IRA
    I have been sent a 1099-R for a regular distibution from my IRA - I am over 59 1/2 years old. I returned a portion of this money back to my IRA within the 60-day rollover period and the amount appeared, correctly, as a 60-day rollover on my IRA statement and was correctly added back to my IRA.

    So far so good. Now, how do I treat this returned amount for tax purposes? What tax form(s) do I need to fill out to effectively lower the amount of my 1099-R so I don't pay income tax on the amount returned back to my IRA?

    If done correctly, where would the credit for the amount returned show up on my 1040, if at all?

    Note: I have already established through my IRA administrator, that the amount returned cannot simply be subtracted from the original amount disbursed and a revised 1099 issued. I have been advised that the original withdrawal, and the subsequent rollover back to the same IRA are two separate events for tax purposes.

    I hope this is clear. Thanks to whomever works on this for any insight provided.

    KPW
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #2

    Apr 16, 2009, 11:11 AM
    The returned amount is NOT taxed, but you will need to file Form 5329 to show that you returned part of the IRA.
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