Thank you again for your clear and kind explanations!
For tax year 2020, we already claimed her as a dependent, when filing her tax, she will choose "I can be claimed, and someone will claim me", she was 16 in 2020.
For tax year 2021, we will NOT claim her as a dependent, when filing her tax, she will choose "I can be claimed, but no one will claim me".
Here is our plan:
1. call Vanguard today, take out $1250 plus earning from her 2021 Roth
2. Once her 2021 Roth contribution changes from $6K to $2602 (6000-3398), then to 1352 (2602-1250), call Vanguard, tell them my daughter wants to rollover her regular Roth IRA distribution that was made on March 4 to her 2021 Roth
Or step 1 and 2 can be done the same time, vanguard doesn't care if she has already received her March 4 distribution. Does "distribution" mean $1250 or 1250 plus earnings?
Thank you so much for guiding us through all these troubles!
