"Are your converted funds in the same Roth IRA account as the one to which you made the deposit of the excess contribution?"
- Yes.
"In what year did you do your first Roth conversion? Was it a taxable conversion?"
- First conversion in 2021. All the money in Roth IRA is from conversion and is after tax, I never ever contributed to Roth IRA directly before this mistake that I did in 2022.
"So now, there is no way for the brokerage account to correct it - either re-characterization to traditional or a corrective distribution. Because the money doesn't exist." --> This is what the brokerage retirement services personnel explained to me. I did tell him that I have $4500 balance in IRA that was converted from traditional, so technically I do have balance and they should be able to re-characterize the 2022 $1500 direct contribution. But as per them, converted money is accounted separately and cannot be treated as direct contribution and hence cannot be used to withdraw (corrective) or re-characterize the $1500 direct contribution.
But based on the response here, I think I'll have to call the brokerage firm again and talk with another representative.
