Ira Rollover

[dusty]

Client - age 72 - received a gross distribution from her IRA. Coded 7 but no federal income tax was withheld. (first clue that this was suppose to be a rollover but she received the check).

Within 60 days she redeposited it in other bank in an IRA account less $1,200.00.

Is this classified as a partial rollover and only the $1,200 is taxable?

Gads hope this season is still over - I find I am doubting myself more and more every day and spending more time researching than completing.

Thanks a million for all you board members that are helping us brain dead preparers.

[Jade06]

Client - age 72 - received a gross distribution from her IRA. Coded 7 but no federal income tax was withheld. (first clue that this was suppose to be a rollover but she received the check).

Within 60 days she redeposited it in other bank in an IRA account less $1,200.00.

Is this classified as a partial rollover and only the $1,200 is taxable?

Gads hope this season is still over - I find I am doubting myself more and more every day and spending more time researching than completing.

Thanks a million for all you board members that are helping us brain dead preparers.

First you need to ask her if it was supposed to be a roll over or if the check was mailed to her absent mindedly. You know how impulsive people are. Never underestimate the ability of a human to be temperarily stupid. She might have thought to use it for something ( traveling to see family, update her living conditions, etc.) then reconcidered the idea and put it back into an IRA. Second you are right if it is a partial rollover the portion that did NOT rollover is taxable. DEPENDING: If it was used to help her children or grandchildren with education expences. Then again it is not taxable if it was used for Qualified Education Expences. Remember to check all avenues and ask for as much information as you can.

Jade!!