Return money to a roth ira that was used to buy a house
Terry, I withdrew 90,000 in July(2020) to buy a lake house (a 2nd home). One of our neighbors offer to buy it from me, and it was an offer I can’t refuse. Can I return that money back to my roth? If not, do you have any suggestions what I should do with that money and my profit. Thanks
Terry Says
Well, glad you made a profit. But you can’t return it after six months have passed! Good thing you didn’t have to pay taxes on the withdrawal, as you’ll pay a short-term capital gains tax on the gains, adding the amount to your current ordinary income. If you’re still working, you can make a contribution to your Roth IRA for 2020 (last year) up until your tax return deadline, and another contribution for 2021 right now. Depending on your age (under 50 or over) that will sop up some of the profits!
And no one says you can’t save the money outside an IRA!!
