Liquidating roth ira

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Actually liquidating the account is relatively simple, but the tax reporting is more complicated.Complete a distribution request form and submit it to your financial institution.There are two primary types of individual retirement accounts: traditional IRAs and Roth IRAs.

On Line 15b, report the ,000 taxable portion and on Line 15a, report the entire ,000 liquidation.If you liquidate your account prior to reaching age 59 1/2 years all of the earnings will be considered non-qualified and will be subject to taxation.You may liquidate your Roth IRA after you reach age 59 1/2 and all earnings that have remained in the account for at least five years will be completely free of federal income taxes.Report the taxable portion of the IRA distribution on Line 15b of Form 1040.If a portion of distribution is tax-free, report the entire amount of the distribution on line 15a of Form 1040.

You'll have to provide identifying information, such as your Social Security number and account number, and the amount you want to withdraw.

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