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grencha · Feb 9, 2013, 10:36 AM

When filing a Tax return is there a difference between the 2 or are the equally the same? You usually are asked if you have 1 or the other so do you have to specifically declare 1 or the other?

ScottGem · Feb 9, 2013, 10:52 AM

A 401(k) is a plan offered by a corporation to its employees, an IRA is a plan setup by an individual. They both allow for deferring taxes on contributions and income until retirement. (a ROTH IRA is different). But that is the only similarity.

You need to declare any contributions you make during the year to a traditional IRA and any distributions made from an IRA or 401(k).

grencha · Feb 9, 2013, 12:45 PM

Originally Posted by ScottGem

A 401(k) is a plan offered by a corporation to its employees, an IRA is a plan setup by an individual. They both allow for deferring taxes on contributions and income until retirement. (a ROTH IRA is different). But that is the only similarity.

You need to declare any contributions you make during the year to a traditional IRA and any distributions made from an IRA or 401(k).

Reply:
I am not sure about you answer because I was asking if on a tax return do you have to specfy if your retirement fund is either 401k through an employer or a personal fund like an IRA that I have through my bank. My bank told about the same thing that you did. My concern is about doing an actual tax return and when you have to answer about having a retirement fund. Last year I had a rollover from a 401k to a IRA and I do not remember if these funds are separate on the tax return. I guess I will have to make sure if this is true this year when I do my return. Thanks for your answer .

AtlantaTaxExpert · Feb 9, 2013, 01:01 PM

On an actual return, the 401k contributions have already been deducted from your paychecks. These contributions are documents on your Form W-2 in Box 12 under a "D" code, and they reduce your salary by that amount.

The amount contributed to your IRA, on the other hand, must declare on your tax return on either Form 1040A or 1040.

ScottGem · Feb 9, 2013, 01:49 PM

Sorry but your question was not clear. If you did a full rollover there was no tax consequence so you shouldn't need to list it on your return.

AtlantaTaxExpert · Feb 9, 2013, 02:15 PM

Scott,

Actually, the rollover IS reported on the tax return, but there are NO tax consequences.

Grencha,

Look at your 2011 return where it says pensions or IRA. If there is a figure there, but NO taxable figure on the right of the form, the rollover was properly reported.