Fermion
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Can you legally (no criminal consequences) make a Roth contribution if you have no earned income and just pay the 6% per year penalty until you withdraw the contribution?
If yes, then is it true that you only have to withdraw the contribution and not the earnings?
If I had a risky investment I wanted to make, but did not want to be taxed on the possible gains, I might be willing to pay an extra 6% for the option to have those gains be tax free.
An example might be buying $10,000 of stock options in XYZ using a non eligible Roth contribution, paying $600 in penalty, selling the options for $50,000 then withdrawing the $10,000 and leaving the $40,000 in the Roth.
Legit?
Also, would entirely losing the $10,000 in the option play count as withdrawing it, or how would one withdraw from an account with zero balance?
If yes, then is it true that you only have to withdraw the contribution and not the earnings?
If I had a risky investment I wanted to make, but did not want to be taxed on the possible gains, I might be willing to pay an extra 6% for the option to have those gains be tax free.
An example might be buying $10,000 of stock options in XYZ using a non eligible Roth contribution, paying $600 in penalty, selling the options for $50,000 then withdrawing the $10,000 and leaving the $40,000 in the Roth.
Legit?
Also, would entirely losing the $10,000 in the option play count as withdrawing it, or how would one withdraw from an account with zero balance?