I contributed $6000 to my Roth IRA in 2019. It turns out I wasn't eligible to contribute any for 2019. I had my broker move the excess to my 2020 contribution (for which I am eligible) on Sept 10th 2020. My account is worth less than it was before I contributed the excess amount and my broker rolled over $5100.
- Do I still need to withdraw $900 to correct last year's excess contribution?
- How does the 10% payment on earnings work? I accumulated interest and dividends since the excess contribution.
- Do I need to pay the 10% on those despite the entire account being worth less or will I not have any penalty on earnings?
- Does the earnings penalty only apply to earnings between the excess contribution date and the date it's corrected, the entire year or something else?
- Or is the 10% on earnings ignored when you are paying the 6% on the excess at this point in time?
