- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Report Inappropriate Content
Retirement tax questions
1. Am I correct to think that these contributions count toward my 2022 Roth IRA Contributions?
That depends on what you told the plan. It could have been applied to 2022, but that would not have been automatic. It depends on what you told them. It will be recorded on your 2022 and 2023 form 5498 issued by the plan.
2. Should have put $30 instead of $60 when reporting my excess Roth IRA contributions in my 2023 tax return?
That depends on #1. Either you have a $30 excess for 2023, or you have a $60 excess for 2023. If you filed with a $60 excess and paid the penalty ($3.60), and you discover that the first $30 was applied to 2022, then you could amend and report a $30 excess, and get a refund of $1.80 of the penalty you previously paid. I would probably not bother to change it even if you were wrong, since the amount is so small. You should generally use mail tracking when you file an amended return, and that will cost way more than the amended refund.
3. I got married in October 2024, and my husband and I plan to do our taxes this year Married Filing Jointly on TT.
Congratulations. Since I don't think you should bother amending 2023 for less than $2, you can file 2024 any time.
4. I realize I will have to pay the 6% penalty again because I haven't withdrawn the excess amount from my Fidelity Investments account for another year, but I'm not sure if my excess amount is $30 or $60, so I don't know how much to withdraw!
No. Married changes everything.
5. should I immediately mail a printed 2023 version or 2024 version of Form 5329 to the IRS with a check to pay for the penalty of having it in my account for another year?
Your 2024 return will include a form 5329 to close out the situation. Don't do anything separate or extra. Just file when you are ready.
6. How much do I withdraw from my core cash on Fidelity at this point? Do I include the earnings/losses?
Probably nothing. Marriage changes everything.
Why does marriage change things? As long as your income allows you and your spouse to make Roth contributions for 2024, you don't need to remove any excess. You can apply the 2023 excess to your 2024 limit. You "use up" the excess by applying the 2023 excess as a 2024 contribution. And even if you don't work, you can contribute to a Roth IRA if your spouse worked. This all happens on form 5329, just file your tax return and pay attention to questions about Roth contributions, past Roth contributions and so on.
If you and your spouse's income is so high that you can't contribute to a Roth for 2024, then you would pay a 6% penalty on your 2024 return. Then you can withdraw $60 in 2025 and that will zero out the excess. You don't have to withdraw earnings because the timeline for that special procedure is expired, and withdrawal of contributions is not taxable or subject to a penalty, it would have to be reported in 2025 but would not be taxable.