I am making after-tax contributions to an IRA. Will I get taxed again when I withdraw it (when eligible)?

By Denise Appleby AAA
A:

No. Withdrawals of your after-tax contributions to your IRAs should not be taxed. However, the only way to make sure this does not happen is to file IRS Form 8606. Form 8606 must be filed for every year you make after-tax (non-deductible) contributions to your Traditional IRA and for every subsequent year until you have used up all of your after-tax balance.

(To read more about IRA contributions, read Retirement Plan Tax Forms You May Need to File – Part 1 and Part 2, and An Overview of After-Tax Balance Rules.)

This question was answered by Denise Appleby
(Contact Denise)

RELATED FAQS

  1. Places where I can open an IRA Account?

    Open an IRA through brokerage firms, mutual funds, banks and other major financial institutions, or through large Internet ...
  2. What rate of return should I expect on my 401(k)?

    Learn what factors affect your 401(k) performance, and understand what a typical rate of return is for employer-sponsored ...
  3. How can an entrepreneur save for retirement?

    Learn about the retirement savings plan options for entrepreneurs and small business owners, including administration and ...
  4. What would privatized Social Security mean for Americans?

    Take a deeper look at how a privatized Social Security system would work, including looking at a real example that's existed ...
RELATED TERMS
  1. Self Invested Personal Pension (SIPP)

    A tax-efficient retirement savings account available in Great ...
  2. Senior Move Manager

    Senior move managers (SMMs) help seniors downsize and relocate ...
  3. Elder Care

    Elder care, sometimes called elderly care, refers to services ...
  4. Gold IRA

    Definition of Gold IRA
  5. Eligible Transfer

    An IRS-allowed movement of assets into or out of an individual ...
  6. Death Master File (DMF)

    Also known as Social Security Death Index. A list of people whose ...

You May Also Like

Related Articles
  1. Retirement

    Top 10 Stocks for Retirement Portfolios

  2. Trading Strategies

    Top 7 Roth IRA Stocks for 2015

  3. Professionals

    Are Longevity Annuities in 401(k)s a ...

  4. Professionals

    Why Retirement Advice Is Better But ...

  5. Professionals

    Coming Soon: Private Equity In 401(k) ...

Trading Center