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Megan C
Megan C, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 16547
Experience:  Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
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My mom retired this year. She took $60,000 out of her IRA

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My mom retired this year. She took $60,000 out of her IRA to buy a condo and was going to replace it in her IRA with proceeds of the sale of her home. It looks like the home won't close on time for her to refund the IRA within the 60 day window. Are there any options to extend the 60 day window, or other ways to avoid the tax implications such as when the house closes putting $60,000 in a new retirement account?
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.

I hate to be the bearer of bad news, and please don't shoot the messenger. Unfortunately there is nothing that can be done to extend the 60 day window. So, this distribution will be taxable to her this year.

I'm truly sorry. If you need anything additional please let me know. Please take a moment to rate my response excellent so that I may receive credit for assisting you today. Thanks.
Customer: replied 3 years ago.

What about the second part; can she lower the amount of tax implication by putting some of the proceeds of the sale of the house into a IRA? She is 66 and retired from a lower wage job in March of this year?

Thank you for your follow up. The most your mother can contribute to an IRA is $6,500 in 2013. So yes she can lower the taxable amount, but only by about 10%. I'm truly sorry that there aren't more options. Please let me know if you need anything additional. If not, please rate as excellent so that I may receive credit for assisting you today. Thanks
Megan C and other Tax Specialists are ready to help you
I just wanted to say thank you Kurt for your positive rating. If you ever need another tax question answered please ask for me, I also can answer any Social Security or Finance question for you that you may have in the future.

Thanks again and I hope you and your family have a great night

Megan

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