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We took a 80,000 distribution from an IRA and landed it

We took a 80,000...

We took a 80,000 distribution from an IRA and landed it someone on January 10th with the intention to put it back within 60 days after a house sold i was selling. it now is going to be another 60 days to close which puts me out side the to 60 day window. I am 55 years old so I know I will have the 10 percent penalty to pay but if I put the 80,000 back in the next 60 days within the same calendar year will this still be income against me?

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3/8/2018
Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 17,645
Experience: 15years with H & R Block. Divisional leader, Instructor
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Hello, I'm Robin. Welcome to JustAnswer. I'm reviewing your question now and typing up my reply. I'll post that in just a few moments.

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Customer reply replied 1 month ago
Thanks Robin

You are correct you will have a 10% penalty and unless you can complete a rollover in the required 60 days you will also see this as income unfortunately.

The rollover time is not extended to another 60 day period.

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Well there are certain circumstances apply to the taxpayer if you miss the 60 days. Those circumstances are:

  1. An error was committed by the financial institution making the distribution or receiving the contribution.
  2. The distribution was in the form of a check and the check was misplaced and never cashed.
  3. The distribution was deposited into and remained in an account that I mistakenly thought was a retirement plan or IRA.
  4. My principal residence was severely damaged.
  5. One of my family members died.
  6. I or one of my family members was seriously ill.
  7. I was incarcerated.
  8. Restrictions were imposed by a foreign country.
  9. A postal error occurred.
  10. The distribution was made on account of an IRS levy and the proceeds of the levy have been returned to me.
  11. The party making the distribution delayed providing information that the receiving plan or IRA required to complete the rollover despite my reasonable efforts to obtain the information.
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Customer reply replied 1 month ago
If it is put back in the same calendar year such as the next. is that any way to reduce your income. I guess there anyway to get the income that will be coming reduced by paying it back or investing it in an another IRA

You must meet the 60 days whether you put t back or into a new one. It is not a rollover unless you do, it is just a distribution.

You know you cannot make a contribution of $80K into an IRA.

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Customer reply replied 1 month ago
please
Customer reply replied 1 month ago
what other ways can we use the 80 to reduce the tax liability in the same calendar year.

Did you read the list of possible exceptions to not meeting the 60 day time requirement? Those are the only reasons the IRS would allow more time. Your situation as you explained it, does not meet any of those unfortunately.

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Customer reply replied 1 month ago
it does not. I am trying to eliminate the adjusted gross income at the end of this year to reflect the 80,000 as much as possible .
Customer reply replied 1 month ago
im sorry to offset the 80,000 that will be shown as a distribution.

If you can contribute to an IRA then you can do that but that is just $5,500 ($6,500 if you're age 50 or older). Not much help

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Customer reply replied 1 month ago

For 2018 yes. Those are claimed for the actual year you make them.

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Customer reply replied 1 month ago
OK, what other ways can be used to reduce the 80,0006500 to IRA
80,000 contribution
what other ways to reduce the adjusted gross income

After the year ends there is just very limited options that one can do to reduce the prior year income.

That is pretty much it. The small amount for the IRA

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Customer reply replied 1 month ago
ITs not after the year ends. the withdraw was made Jan 2018 for 80,000 the 60 days is this weekend. we will have the remainder of this year to itemize the deductions. Outside of the IRA and Charitable contributions what other deductions can be made between now and year end 2018 to reduce the adjusted gross income

So much has changed for 2018.

These on the Schedule A for 2018 are Fully eliminated

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I am searching but that is a lot to try and eliminate or even reduce. It's not like it's stocks so I can purge the bad ones and show some loss.

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Customer reply replied 1 month ago
what if the whole 80, 000 was given to the church36,000 is the annual income it is fixed
then this 80,000 will be taxed.
there will be some housing interest expenseif the whole 80,000 is given to the church what would that look like

The deduction for charitable contributions is expanded so that taxpayers in 2018 may contribute up to 60% of their adjusted gross income, rather than up to 50% like now.

That would be 60% of $116000 ($69600)

If you were to donate all the $80 you would be allowed to carry the remaining over to 2019

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Customer reply replied 1 month ago
Ok, the investment house that will be sold. bought it in January for 235,000, if we don't sell it until next year. can we deduct the interest, and what would the depreciation on it as an expense

Are you using this property as rental?

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Customer reply replied 1 month ago
1100 per month until April then we were selling it

Then yes you still count the depreciation and the interest against the rental income.

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