mcd1231
Level 4

Help and reassurance please, tax year 2018

Client received a total distribution from a company sponsored Roth 401K.  The store location in which she worked closed down.  Client is 58 years old in 2018.  

The total distribution was $16,416.61.  $11,920.42 was her designated Roth contribution and $4,496.19 was company's contribution. She rolled over the total amount as follows:   $11,920.42 to a Roth and the company's contributions or $4,496.19 to a Traditional IRA.  OK total roll over of the distribution, code G, so nothing is taxable.

Then later on in 2018, she withdraws $5,500 from the Roth IRA with a code J, early distribution from a Roth.  Here is where I am looking for reassurance.  My thoughts are this $5,500 is not table because she already paid tax on it as an employee and there is no 10% penaltyeven though she is not 59 1/2 yet.

And my next question is the $4,496.19 that she rolled over from her Roth IRA at work into a traditional IRA, is that considered a deductible contribution to an IRA?

Thank you in advance for your help

                                                                                                                                                              

0 Cheers