Hi,
I have a pretty complicated issue on excess contribution to Roth IRA for tax year 2022. Any insights and suggestions are appreciated.
In early 2023 when I started filing my tax for 2022, TurboTax told me I overfunded the Roth $2,000 as my income increased. I then withdrew the excess contribution by myself instead of asking my plan admin to do so. Now I knew it's wrong as I received 2023 1099-R which coded the $2,000 as early withdrawal instead of removal excess contribution. I explained the situation to my plan admin but they said there is nothing they can do as it's beyond the IRS deadline. What I'm confused about are:
1) is the 2022 excess contribution still in my Roth account? If so, what options I have to remove them?
2) if not, I don't think I need pay 6% penalty on excess contribution for 2022 but do I need file form 5329 and tax amendment for 2022? When I filed my 2022 tax after I have self-withdrawn $2k, the Roth IRA contribution I entered in TurboTax doesn't include the excess amount ($2k) as I thought I've already removed them.
I have no other IRAs except this Roth IRA. I'm planning to open a traditional IRA for backdoor Roth for tax year 2023 and 2024 after I figure out how to fix the current issue.
Thanks!
I have a pretty complicated issue on excess contribution to Roth IRA for tax year 2022. Any insights and suggestions are appreciated.
In early 2023 when I started filing my tax for 2022, TurboTax told me I overfunded the Roth $2,000 as my income increased. I then withdrew the excess contribution by myself instead of asking my plan admin to do so. Now I knew it's wrong as I received 2023 1099-R which coded the $2,000 as early withdrawal instead of removal excess contribution. I explained the situation to my plan admin but they said there is nothing they can do as it's beyond the IRS deadline. What I'm confused about are:
1) is the 2022 excess contribution still in my Roth account? If so, what options I have to remove them?
2) if not, I don't think I need pay 6% penalty on excess contribution for 2022 but do I need file form 5329 and tax amendment for 2022? When I filed my 2022 tax after I have self-withdrawn $2k, the Roth IRA contribution I entered in TurboTax doesn't include the excess amount ($2k) as I thought I've already removed them.
I have no other IRAs except this Roth IRA. I'm planning to open a traditional IRA for backdoor Roth for tax year 2023 and 2024 after I figure out how to fix the current issue.
Thanks!
Statistics: Posted by chunk99 — Tue Mar 19, 2024 1:28 am — Replies 0 — Views 68