Have a Tax Question? Ask a Tax Expert
Thanks for asking your question! I'm sorry to hear about your tax issue and I'm going to try my best to help you understand or resolve it.
How are you today?
switching to q&A
Why did I have to pay tax twice. I paid when I transferred it over and then I had to claim as income. This doesn't make sense.
Thanks for your follow up. I see you rated our service as "bad" - this penalizes me personally. Please don't rate me bad, simply because the answer is not satisfactory. I have an obligation to give you an honest answer, which I have given. Thanks for your kind understanding.
You should not pay tax twice. When you placed funds into a traditional IRA, those are pre-tax contributions. You do not pay tax on that money initially.When you transfer to a Roth IRA you do owe tax, because funds in a Roth account are post-tax, and not taxed when you take them out.Please let me know if anything is unclear. Thanks again for using JustAnswer.com, and don't forget to rate my response as "Excellent" so that I may receive credit for assisting you today.
Why did I get a 1099 on this money that I already paid tax on. This was NOT income but I had to claim it as income... even though it went into the Roth.
I don't think you are understanding my question or maybe I'm not explaining it right. I am very frustrated. I'm talking about 2011 when the money was transferred. I paid tax on it at time of transfer. Why did I get a 1099 for that amount which I had to claim as income when it was not income. It was just an IRA transaction.
What you say makes sense. The problem I'm having is by claiming the 1099 on my income tax... (basically saying its income) it puts me in a higher tax bracket and I had to pay income tax. I am under the impression that I should only receive a 1099 when I withdraw this money which I did not. BTW... I was 65 at the time.