Roth distributions MAY be taxable under certain conditions. Contributions are always non-taxable when distributed. Roll-overs and conversions when distributed may be taxable. And earnings when distributed may also be taxable. The taxability depends on age of the contributor (59 1/2 or more), age of the contribution (5-year rule)
The IRS has rules about where distributions come from: contributions first, then rollovers and conversions, and then earnings. Thus my question about keeping track of contributions vs. rollover/conversions vs. earnings in GnuCash, and if so, how. On Thu, Jun 4, 2026 at 3:46 AM David Warren <[email protected]> wrote: > I track Roth IRAs and my Roth 401(k) the same way I do all of my other > broad investment / brokerage accounts: > > Contributions credit the bank account and debit the Roth IRA. > At some periodicity (could be every 3, 6, or 12 mos), I change the > investment balances, which in a rising stock market has typically meant > debit the Roth IRA, credit Income:Nontaxable Investment Income. (I > understand other people may prefer a different credit account; this works > for me for tracking. David T says below "earnings are tracked in separate > income accounts for tax tracking purposes. Note that *nothing *on Roth > IRAs needs to be 'tracked' or reported in the USA, but perhaps David T > means "separate" from his/my *other *income accounts that do need to be > reported.) > > When I eventually take distributions, no, I won't make "extra" entries to > track for the IRS, I will simply credit the Roth IRA account and debit the > asset account where I have sent the distribution. > > Note that this is less involved than what I would do if I had REGULAR IRAs > or 401(k)s, as there I would be tracking eventual tax liabilities on growth > in those accounts, and then when I eventually take Required Distributions, > then the portion of the distribution that is taxable I would track into a > taxable income account. Here's an example for a REGULAR IRA. Say the > account balance was $500,000 at 2029-12-31 and I was required to withdraw > 5% of it per the tax code in 2032. When I take that $25,000 required > withdrawal, I would record it as: > > Credit Regular IRA $25,000 > Debit Brokerage Account $25,000 [these two record the transfer of assets] > Credit Income:Taxable:IRA withdrawal $20,000 [this presumes a calculation > that my tax basis in the IRA as of the withdrawal date was 100,000, or 20% > of the balance] > Debit Income:Nontaxable:IRA Deferred Growth $20,000 > Credit Liabilities:Taxes Due this year $8,000 [at 40% tax rate] > Debit Liabilities:Deferred Taxes on IRAs $8,000 (this account would have > been credited every year as the IRA grew from investment earnings) > > > On Thu, Jun 4, 2026 at 2:29 AM David T. via gnucash-user < > [email protected]> wrote: > >> Clint, >> >> I don't see any other replies, so... >> >> Our family has four Roth accounts-- one each for an IRA and an employer >> retirement plan. I track all the contributions and earnings for those >> accounts* (we haven't yet taken distributions **). That way, I can see >> generally what our retirement savings look like. >> >> Tracking actual daily value for these accounts is, frankly, more trouble >> than it's worth. Our retirement plans mask the investment details, and only >> provide generalized data, which makes tracking difficult. So, I mostly >> check that the share balances are correct from year to year. This gives me >> a broad sense of our progress toward the long term goals. >> >> HTH, >> David T. >> >> * - Contributions are handled as standard transactions between asset >> accounts, while earnings are tracked in separate income accounts for tax >> tracking purposes. >> >> ** - IANAA, but I understand that when distributions are made, extra >> entries must be made in GnuCash to allow you to track the distribution as >> income for IRS tracking. >> >> >> >> On June 3, 2026 9:22:21 PM GMT+05:30, Clint Chaplin <[email protected]> >> wrote: >> >For those of you using GnuCash and having Roth accounts, do you use >> GnuCash >> >to keep track of contributions vs. rollover/conversions vs. earnings, and >> >if so, how? >> > >> >-- >> >Clint (JOATMON) Chaplin >> >_______________________________________________ >> >gnucash-user mailing list >> >[email protected] >> >To update your subscription preferences or to unsubscribe: >> >https://lists.gnucash.org/mailman/listinfo/gnucash-user >> >----- >> >Please remember to CC this list on all your replies. >> >You can do this by using Reply-To-List or Reply-All. >> _______________________________________________ >> gnucash-user mailing list >> [email protected] >> To update your subscription preferences or to unsubscribe: >> https://lists.gnucash.org/mailman/listinfo/gnucash-user >> ----- >> Please remember to CC this list on all your replies. >> You can do this by using Reply-To-List or Reply-All. >> > -- Clint (JOATMON) Chaplin _______________________________________________ gnucash-user mailing list [email protected] To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user ----- Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
