DanaB27
Expert Alumni

Retirement tax questions

If your Roth IRA contribution was limited by your MAGI and you want to avoid the 6% penalty then you can either recharacterize the contribution as a traditional IRA contribution or you request the withdrawal of the excess contribution plus earnings by the due date. 

 

If you choose to withdraw the excess contribution plus earnings it is best to withdraw a little more than the excess contribution since the earnings will increase your MAGI and this will change how much you can contribute to the Roth IRA (if you are in the phaseout range).

 

Please see What happens if I made an excess Roth IRA contribution and How do I amend my federal tax return for additional information.

 

 

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