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I retired two years ago at 62 from a Fortune 200 company where I had stock options. These options stay active till 2022. For income I have a pension, deferred income and a part time job. I am delaying SS. In June of this year I took $46,000 from my substantial IRA in an effort to reduce future taxes by max'ing out the current tax bracket basis my current income. Taxes were taken out of the distribution.
Now my previous employer is being sold and the options I have that are in the money will come into fruition. This will result in "unexpected income" that will "blow" me into the next tax bracket. Can I pay back the $46,000 I took out of my IRA?
I don't think you can return the funds but If I'm not mistaken, any distribution can be transferred to a new custodian within 60 days. If the full 46k is transferred within 60 days it will be considered a rollover instead of a distribution.
I'm not sure how the taxes paid would work itself out. I'm assuming the custodian would give you a 1099 with a distribution of $0 and taxes paid of $X,XXX.
If it's still within 60 days, I'd call my custodian and see what can be done, if anything.
^^^ Yes, you should be able to roll it into a new IRA tax free. Any of the big brokerages (Vanguard, Fidelity, Schwab, etc) will be happy to arrange the rollover for you for free (they want to babysit your money). Just don't miss that 60 day window!
The suggestions are called a roll over IRA. If you miss the 60 days the IRS might give you some outs. I think the loosened the rules a little. Go to the IRS site and look for roll over IRA
Thanks, trade was made July 17 so I have some time. I'll check with Vanguard on putting it right back in. Taxes will be another issue as I am sure they sent "Uncle Sam" his due per my instructions.
It was surprisingly easy to save for retirement taking the money out wisely and tax efficiently is the real challenge.
Rumors of the company sale were just that...rumors. Slight run up but then back to historic levels. My options "live" until 2021 so I have time left. Will leave the IRA withdrawl right where it is.
Thanks for the advice, may need it in the future.
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