Rainman1966
Level 3
04-13-2022
08:52 AM
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He has no basis as he withdrew all of his contributions in prior years. If he would have waited 30 days in order to meet the 59 1/2 rule he would have had no taxable income from the withdrawal. Now he has a taxable Roth distribution plus the 10% penalty. I was hoping that someone might have encountered this problem and knew of a way to get the penalty waved. Probably an impossibility.