- § 5.01 Overview of Taxation of Participants in IRAs
- —–[1] Taxable Portions of IRA Distributions
- —–[2] Penalty on Premature Distributions
- —–[3] Transfers from an IRA to Another IRA or Plan
- —–[4] Transfer from an IRA to a Health Savings Account
- —–[5] Taxation of Collectibles
- —–[6] Consequences of Prohibited Transactions
- —–[7] Assignment of Rights in an IRA
- —–[8] Effect of Loans or Pledges
- —-[9] Surviving Spouse Election to Become Owner
- —-[10] Transfers Incident to Divorce or Legal Separation
- —-[11] Exempt Charitable Organization as an IRA Beneficiary
- —-[12] Income Tax Withholding
- § 5.02 Definition and Categories of IRAs
- § 5.03 Administration of IRAs
- —–[1] General Administrative Considerations
- —–[2] Investment in Collectibles by Individual Retirement Accounts
- —–[3] Prohibited Transactions of Individual Retirement Accounts
- ———-[a] Prohibited Transactions Generally
- —————[i] Terminations of Some Individual Retirement Accounts
- —————[ii] Penalty Taxes Imposed for Other IRAs
- ———-[b] Prohibited Transactions
- —————[i] Prohibited Transactions Defined
- —————[ii] Loan or Extension of Credit
- —————[iii] Property Transactions and the Furnishing of Services
- —————[iv] Use of IRA by or for a Disqualified Person
- —————[v] Dealing with an IRA for a Fiduciary’s Own Interests
- —————[vi] Payments to Fiduciary by a Third Party Dealing with IRA
- —————[vii] Ownership Threshold in Entities Involved in Transaction
- —————[viii] Form 5329 and the Statute of Limitations
- ———-[c] Transactions Excluded from Prohibited Transactions
- ———-[d] Definition of Disqualified Person
- ———-[e] Definition of Fiduciary
- ———-[f] Status of the Retiree/Owner
- —–[4] Borrowing, Pledging, or Assignment of IRA Funds
- ———-[a] Treatment of Assigned IRA Funds
- ———-[b] Individual Retirement Annuity Loans and Pledges
- ———-[c] Individual Retirement Account Loans and Pledges
- ———-[d] Bankruptcy Proceedings
- ———-[e] Borrowing Non-IRA Funds to Contribute to an IRA
- —–[5] Unrelated Business Taxable Income
- —–[6] Retiree’s Payment of IRA Expenses
- —–[7] Applicability of the “Wash Sale” Rule to IRAs
- —–[8] IRA Provisions that Place Restrictions on Distributions
- —–[9] Self-Directed IRAs
- § 5.04 Penalty on Premature IRA Distributions
- —–[1] Penalty Generally Applies in the Absence of an Exception
- ———-[a] Penalty in General
- ———-[b] The Age and Death Exceptions
- ———-[c] The Disability Exception
- ———-[d] The Substantially Equal Payment Exception
- —————[i] Substantially Equal IRA Payments Generally
- —————[ii] Substantially Equal Annuity Payments
- —————[iii] Substantially Equal Non-Annuity Payments and Safe Harbors
- —————[iv] Tailoring the Source and Amount of Payments
- —————[v] Potential IRS Relief for Erroneous Payments
- —————[vi] Modifications of Payments Triggering Penalties and Interest
- ———-[e] Exception for First-Time Homebuyers
- ———-[f] Exception for Higher Education Expenses
- ———-[g] Exception for Medical Insurance Premiums of an Unemployed Taxpayer
- ———-[h] Distributions Not Exceeding Itemized Medical Deductions
- ———-[i] Distributions to Military Reservists
- ———-[j] Qualified Birth or Adoption Distributions
- ———-[k] Emergency Personal Expense Distributions
- ———-[l] Domestic Abuse Distributions
- ———-[m] Income Attributable to Corrective Distributions of Excess Contributions to IRAs
- ———-[n] Distributions to Terminally Ill Individuals
- ———-[o] Distributions for Qualified Federally Declared Disasters
- ———-[p] Other Specific Exceptions
- ———-[q] Other Attributes of the Homebuyer, Education, and Medical Expense Exceptions
- —–[2] Other Considerations in Applying the Penalty and Exceptions
- ———-[a] Distribution of Funds Previously Rolled Over to an IRA
- ———-[b] Beneficiary Rollovers of Decedent’s IRA or Plan Funds
- ———-[c] Investments in Collectibles by IRAs
- ———-[d] Prohibited Transactions with IRAs
- ———-[e] IRA Loans and Pledges
- ———-[f] Involuntary Distributions
- ———-[g] Personal or Financial Hardship
- ———-[h] Deemed Distributions
- ———-[i] Harsher Penalty for Simple IRAs
- ———-[j] IRA Funds Transferred to an Employer Plan to Avoid the Penalty
- ———-[k] Form 5329 and the Statute of Limitations
- § 5.05 Taxation of IRA Distributions
- —–[1] General Rules for Taxation of IRA Distributions
- —–[2] Investment in IRAs
- —–[3] Nontaxable Portion of IRA Distributions
- —–[4] Timing of an IRA Distribution Relative to a Rollover from a Qualified Plan
- —–[5] Withdrawal of Excess Contributions
- —–[6] IRA Distributions Not Taxed on Separate Return of Spouse
- —–[7] Deduction of Loss on Final Distribution
- —–[8] IRA Distributions Paid Directly to Charities
- —–[9] IRA Funds Transferred to a Health Savings Account
- § 5.06 Nontaxable Rollovers to a Different IRA or Employer Plan
- —–[1] Tax-Free Rollovers of Funds in General
- —–[2] Choice of Indirect Rollover or Trustee-to-Trustee Transfer
- —–[3] Requirements for an Indirect Rollover
- ———-[a] 60-Day Requirement
- ———-[b] Potential Waiver of the 60-Day Requirement
- ———-[c] Self-Certification of Permissible Reasons for Violating the 60-Day Requirement
- ———-[d] Only One Indirect Rollover Per Year
- —–[4] Rollovers to Another IRA that Include Retiree Investment
- ———-[a] Components of a Distribution before Rollover
- ———-[b] Indirect Rollover to Another IRA
- ———-[c] Trustee-to-Trustee Rollover to Another IRA
- —–[5] Rollover within Two Years of Funds in a Simple IRA
- —–[6] Rollovers and Direct Transfers Available to Beneficiaries
- —–[7] IRA Rollovers to Qualified Retirement Plans
- ———-[a] Benefits and Requirements for IRA Rollovers to Qualified Retirement Plans
- ———-[b] Arguments for IRA Retention of Investment Unlikely to Prevail
- ———-[c] Examples Illustrating the Foregoing Discussion
- ———-[d] The Separate Treatment of IRA Distributions Rolled over to a Qualified Plan
- § 5.07 Transfers of IRAs Incident to Divorce or Legal Separation
- § 5.08 Surviving Spouse’s Election to Become Owner of IRAs
- § 5.09 Inherited IRAs
- § 5.10 Exempt Charitable Organization as an IRA Beneficiary
- § 5.11 IRA Contributions by Retirees Working Part-Time
- § 5.12 Mitigation of the Excise Tax on Excess Contributions to IRAs
- —–[1] Origins of a Retiree’s Excess Contributionsto IRAs
- —–[2] Eliminating Excess Contributions by Making Corrective Distributions
- —–[3] Eliminating Excess Contributions by Making Dollar-Limited Distributions
- —–[4] Eliminating Excess Contributions by Making Ordinary Distributions
- —–[5] Eliminating Excess Contributions by Absorption
- —–[6] Eliminating Excess Contributions by Recharacterization
- —–[7] Summary: Excess Contributions Due to Regular Contributions to Traditional IRAs
- —–[8] Summary: Excess Contributions Attributable to Failed Rollovers to Traditional IRAs
- § 5.13 Tax-Free Restorative Payments
- § 5.14 Enhancement of an Annuity Contract on Demutualization of the Issuer
- § 5.15 Applicability of Community Property Laws to IRAs
- § 5.16 Tax Withholding from IRA Distributions
- § 5.17 Tax on Net Investment Income Not Applicable
- § 5.18 Estate or Gift Tax Imposed on IRA Benefits
- § 5.18 Estate or Gift Tax Imposed on IRA Benefits
» Chapter 6 – ROTH IRAs
Tax Planning IdeasFor RetireesClick Here
Recent Tax DevelopmentsAffecting RetireesClick Here
Related Articles Published by the Author of the Treatise
Distributions to Beneficiaries of Tax-Favored Plans: Before and After the SECURE Act, TAX LAWYER, Fall 2020, at p. 43.The SECURE Act: Retirement Plan Distributions After the Death of a Beneficiary, TAX LAWYER, Summer 2021, at p. 629. Planning Lump Sum Distributions of Employer Stock from Stock Bonus Plans and ESOPs, TAXES, Nov. 2015, at p. 49.IRA Rollovers to Qualified Plans: The Retained Investment Issue, TAX NOTES, Sept. 18, 2017, at p.1571.Rollovers to Roth IRAs Are Complicated by Substance-Over-Form Doctrines, TAXES, Sep. 2015, at page 43.Controlling and Minimizing the Taxation of Disability Benefits, TAX LAWYER, Spring 2007, at p. 725.Tax Issues Complicate the Costs of Chronic Illness and Long-Term Care Insurance, JOURNAL OF TAXATION, Apr. 2007, at p. 216.Retirement Plans, IRAs, and Annuities: Avoiding the Early Distribution Penalty, TAX ADVISER, Apr. 2011, at p.254.Maximizing Medical Deductions for Residents of Retirement Communities, JOURNAL OF TAXATION, Jan. 2007, at p. 50.Click here for more articles, and links to the complete texts of articles
