dmertz
Level 15
Intuit Approved! This answer has been verified for accuracy by an Intuit expert employee

Retirement tax questions

Because the $515 distributed from the Roth 401(k) was not eligible to be rolled over to a traditional IRA, the $515 constitutes deposited into the traditional IRA constitutes a regular contribution to the traditional IRA.  If by April 15 2024 your filed your 2023 tax return or requested a filing extension, you have until October 15, 2024 to obtain an explicit return of the $515 contribution.  To get Vanguard to do this you'll need to convince Vanguard that this $515 constitutes a regular contribution despite Vanguard having originally recorded this portion as a rollover.  With a return of contribution, Vanguard will distribute to you the $515 adjusted for the rate of investment gain or loss in the account while the $515 was in the account.  (If Vanguard is uncooperative, you can report the $515 on an amended 2023 tax return as a regular, perhaps nondeductible, $515 traditional IRA contribution, assuming that you have not already made the maximum IRA contribution for 2023.)

 

Separately, to get the $515 into the Roth IRA, you can self-certify under IRS Rev. Proc. 2020-46 that you would qualify for a late rollover of $515 due to financial-institution error.  To allow the deposit of the $515, the IRA custodian must be willing to accept the self-certification.

View solution in original post