Best way to obtain older ROTH contribution #'s

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Hoosier CPA
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Best way to obtain older ROTH contribution #'s

Post by Hoosier CPA » Sun May 07, 2017 3:57 pm

My wife has a ROTH IRA which has been transferred twice and is now at Vanguard. Prior to Vanguard, I don't have records of the contributions that were made to her account, and those accounts have closed. Is there any way to determine what those contributions were? I don't plan to withdraw the funds but it might be helpful down the line to have the records. Are the brokerage companies required to keep records for closed accounts (the contributions were made at AG Edwards, which I think became Wells Fargo after that.

Geologist
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Re: Best way to obtain older ROTH contribution #'s

Post by Geologist » Sun May 07, 2017 4:08 pm

The previous IRA custodians sent you (or your wife) a Form 5498 each year that showed the contributions you made. Assuming you kept these, then you can total the contributions from those.

Whether they keep records on closed accounts (or more likely, how long), I don't know.

retiredjg
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Re: Best way to obtain older ROTH contribution #'s

Post by retiredjg » Sun May 07, 2017 4:28 pm

You can get a transcript from the IRS for those Forms 5498 if she has not kept them.

https://www.irs.gov/individuals/tax-ret ... order-them

Alan S.
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Re: Best way to obtain older ROTH contribution #'s

Post by Alan S. » Sun May 07, 2017 5:47 pm

Hoosier CPA wrote:My wife has a ROTH IRA which has been transferred twice and is now at Vanguard. Prior to Vanguard, I don't have records of the contributions that were made to her account, and those accounts have closed. Is there any way to determine what those contributions were? I don't plan to withdraw the funds but it might be helpful down the line to have the records. Are the brokerage companies required to keep records for closed accounts (the contributions were made at AG Edwards, which I think became Wells Fargo after that.
Looks like a real challenge beyond the 5498 forms or other records you retained. AG Edwards disappeared in 2008, so the 10 years of 5498 transcripts from the IRS would only take you back to 2007. Given the financial meltdown chaos where Edwards was acquired by Wachovia and then Wachovia by Wells Fargo all within a period of several months, and your account was terminated several years ago, it is not likely that you could get any data from Wells, at least not without paying a handsome document research fee.

While Roth contributions are not reported on your return, if you kept your returns back to the late 90s, there might be some notes with those returns, some 1099R forms for any returned contributions, or the 5498 form. Those returns could also indicate TIRA deductions and a Roth and TIRA contributions cannot be maxed in the same year. Old check register entries might also be helpful. This is much like a jig saw puzzle in which you might be able to eliminate certain years from Roth contributions based on info you unearth.

If you can establish Roth contributions for some years, but not all then document what you have evidence for. If she takes a non qualified distribution of less than what you know she contributed, you could report that on Form 8606 and avoid taxes. Otherwise, plan to not take NQ distributions from her Roth unless there is no other choice.

Obviously, Roth documentation is best done every year, since after a certain point these reconstructive efforts become nearly impossible. And remember, even if you have a 5498 you might have recharacterized or had that contribution returned as an excess contribution and that 5498 would then be misleading. In those situations, the 5498 is not corrected, but is replaced by a properly coded 1099R.

Hoosier CPA
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Re: Best way to obtain older ROTH contribution #'s

Post by Hoosier CPA » Mon May 08, 2017 9:28 am

Thanks - yes, I've been good about keeping all the documentation the past ten years or so - there's just some years in the early 00's I don't have the info. We likely won't have a need to pull that money out but still I'd like to have the records, just in case. I'll probably start with Wells Fargo and see what they might have.

diy60
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Re: Best way to obtain older ROTH contribution #'s

Post by diy60 » Mon May 08, 2017 7:41 pm

OP - I would try for the transcripts, you might have some luck. A few years ago I threw out everything but the actual tax returns for most of my tax files dating back to 1975. Unfortunately a few of the late 1980's years I had made non-deductible tIRA contributions but didn't file 8606 forms. These investment accounts were back in the day when you generally invested directly with the mutual fund companies. After some persistent follow up phone calls to these mutual fund companies they were able to come up the transcripts, some dating all of the way back to the account opening in the early 80's. These are not the 5498 forms, but I was comfortable using it for my intended purpose.

JohnFiscal
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Re: Best way to obtain older ROTH contribution #'s

Post by JohnFiscal » Mon May 08, 2017 8:15 pm

I have to admit that this question has me worried. Having burned up my shredder on a few occasions destroying countless old statements and confirmations. Is there some reason that I (or my spouse or another beneficiary) may need this information later?

Does this apply only to Roths?

Alan S.
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Re: Best way to obtain older ROTH contribution #'s

Post by Alan S. » Mon May 08, 2017 9:30 pm

Even if you cannot completely reconstruct all your Roth contributions, all you really need to know for sure is the contributions up the amount of early distributions you would take.

If you need 25k of non taxable distributions, know you made that much for sure but not sure how much more you might have contributed, you could file the 8606 showing your regular contributions at 25k. We do not know that the IRS considers this amount binding should you take additional distributions later, but since you would normally not be taking early Roth distributions unless you really need the distributions, you should not hesitate to claim the basis you are sure of. The actual amount is immaterial once your Roth becomes qualified.

retiredjg
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Re: Best way to obtain older ROTH contribution #'s

Post by retiredjg » Tue May 09, 2017 11:03 am

JohnFiscal wrote:Does this apply only to Roths?
There are two issues that seem to come up pretty often.

One is Roth IRA. If you need to take money out of Roth before it is qualified (age 59.5 and the Roth IRA is 5 tax years old), you need information on how every penny got into the Roth IRA account. This can be simple or very complex if it involves Roth conversions, back door contributions, and rollovers from 401k. For people who don't know how every penny got there, the best they can do is guess and try to piece things together.

The other common issue is traditional IRA and the question of whether a contribution was deducted or not. This is a common aggravation because it seems many people don't know they need to keep up with this information or document a non-deductible contribution on Form 8606.

There could be other stumbling blocks, but these are the two that jump to my mind.

JohnFiscal
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Re: Best way to obtain older ROTH contribution #'s

Post by JohnFiscal » Tue May 09, 2017 12:30 pm

retiredjg:

Thank you for the info. I have carefully held onto a form 8606 for 25+ years, regretting ever having made one year of nondeductible contribution to an IRA. I thought I was safe shredding most everything else (saving annual statements). Hadn't thought about the Roths but at 65 I am safe on those, with no contributions having been made in 7 or 8 years.

retiredjg
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Re: Best way to obtain older ROTH contribution #'s

Post by retiredjg » Tue May 09, 2017 3:44 pm

Sounds like you did all the right things. :happy

I did the same thing - held onto a Form 8606 for 22 years. I had it marked up in red felt tip market ..."KEEP!" Don't remember now how I knew to do that. It worked. I destroyed everything else and kept that one form and used it to convert my basis to Roth after I retired.

goonie
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Re: Best way to obtain older ROTH contribution #'s

Post by goonie » Sat Jul 07, 2018 9:24 pm

Resurrecting this thread from last year...

When withdrawing Roth IRA contributions prior to age 59.5, is documentation of the contribution amounts only needed in the event of an audit? And if so, would 5498 forms be the only acceptable documents? I'm thinking of normal contributions here (not conversions).

I ask because I'm really trying to nail down which years I can safely withdraw contributions for. If nobody knows, I'll call the IRS next week and report back. I searched Bogleheads and the rest of the internet for a little while and didn't come across the answer (that doesn't mean it isn't out there - possibly even having stared me right in the face).

retiredjg
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Re: Best way to obtain older ROTH contribution #'s

Post by retiredjg » Sun Jul 08, 2018 6:07 am

I'b be interested in hearing what you learn from the IRS.

The Form 5498 is the only documentation available that I can think of unless a person has kept a running total on paper or spreadsheet. To my knowledge, if you take money out early, the IRS is not going to contact you unless they notice you go over what your contributions actually were. I don't recall ever seeing a discussion about that here so my guess is it does not happen very often.

I do recall when I made my first Roth withdrawal that it all seemed to be between me and TurboTax. I told TT what my contributions were and probably when (had to do from memory so it was only an estimation) and then I told TT I had withdrawn some.

Bottom line, I do believe the actual documentation is only needed if audited and it seems that will only happen if you make a mistake and the IRS notices you made the mistake.

goonie
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Re: Best way to obtain older ROTH contribution #'s

Post by goonie » Sun Jul 08, 2018 7:44 am

I think you're probably right. My issue is that I don't have 5498 forms for the first several years I was contributing and there doesn't seem to be a way to get them. I'm fairly confident about what I contributed during those years but I don't have any official documentation to back that up.

retiredjg
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Re: Best way to obtain older ROTH contribution #'s

Post by retiredjg » Sun Jul 08, 2018 8:27 am

The 5498 info is available from the IRS for up to 10 years according to the transcript link above. So I'm guessing you mean before that. Roth IRAs started in 1998. Perhaps you can look at your old investment records from 1998 to 2008 and see if you contributed? Or your custodian could look it up if the account has not been moved around?

This link shows how much could be contributed each year. That might help you reconstruct it.

https://en.wikipedia.org/wiki/Roth_IRA

danaht
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Re: Best way to obtain older ROTH contribution #'s

Post by danaht » Sun Jul 08, 2018 8:37 am

Simple solution: just don't withdraw from the Roth until you're wife is 59.5 years old. Use (or build up) your emergency fund if/when you need cash.

Nate79
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Re: Best way to obtain older ROTH contribution #'s

Post by Nate79 » Sun Jul 08, 2018 11:28 am

Any chance you can go at it from the other end by looking at the source of the contributions? Do you have checking/savings account access going back that far to track where the money came from (or whatever the source of the contribution)?

Alan S.
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Re: Best way to obtain older ROTH contribution #'s

Post by Alan S. » Sun Jul 08, 2018 5:51 pm

There is considerable anecdotal evidence that the IRS does not maintain current status of your accumulated Roth contribution basis. I can't recall anyone reporting an IRA inquiry to provide documentation for the amount of basis reported on Form 8606 for a non qualified distribution. Therefore, it also follows that we don't know exactly what type of documentation they would accept. Note that even if you have a 5498 reporting a contribution, you and the IRS would still have that 5498 even if you received a return of contribution or recharacterized it as a TIRA contribution. In the case of a recharacterization however there would also be a 5498 issued by the TIRA custodian that received the recharacterized Roth contribution.

We also do not know for sure how the IRS would react to an incorrect basis amount reported on the 8606. For example, assume that you know that you made at least 10,000 in Roth contributions for sure, but you may have made 20,000. You are only withdrawing 10,000, so you enter 10,000 on the 8606. It is not known if the IRS would consider that as binding if you later turned up the documentation for 20,000 and took another 10,000 distribution. I don't think the IRS is close to looking at the total picture, just the current 8606, so if you are in this situation I would just show the 10,000 that you are sure you contributed, and in the unlikely case of the IRS asking for documentation, it will be easier to come up with 10,000 than 20,000 since there might be certain years that are impossible to decipher.

goonie
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Re: Best way to obtain older ROTH contribution #'s

Post by goonie » Mon Jul 09, 2018 3:35 pm

That's interesting Alan. Thanks.

And thank you retiredjg and Nate79 for the suggestions but yeah, I've looked into those possibilities.

At this point, I think I've exhausted all possibilities for obtaining any sort of documentation (not just 5498 forms) for the first few years I had my Roth IRA. I have the 5498 forms for every year since then. I'm only missing documentation for about 4.5 years of contributions, so I think I'll just give up on ever withdrawing those early. Like I said, I think I know what the amounts were but I'd feel better if I could back them up.

goonie
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Re: Best way to obtain older ROTH contribution #'s

Post by goonie » Tue Jul 10, 2018 12:47 pm

So I decided to call the IRS. I spoke to a very friendly and helpful person but didn't really get anywhere. She checked and there wasn't a way for her to get my contribution amounts for the years in question. She was only able to go back 10 years - just like the online Get Transcript tool. She also said it wouldn't be any different if I mailed in a 4506-T form (Request for Transcript) requesting those years.

I asked her how the IRS validates basis but she didn't know. She suggested contacting their tax law department or making an appointment with a local office. Based on what I read on the website, what the automated phone system said, and what another person told me when I called to make a local appointment, they only have people available during tax season (Jan - April) that can address that question.

So, I may call back during tax season and see if I can get an answer. I was thinking that if they can answer how the basis gets validated (or get me to somebody that could), maybe that would lead to someone being able to tell me what my contributions were. Probably not but who knows.

retiredjg
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Re: Best way to obtain older ROTH contribution #'s

Post by retiredjg » Tue Jul 10, 2018 1:33 pm

Thanks for the update. Good luck!

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