I have been filing as married filing separate since I was married in 2022. Prior to the marriage I had been contributing to a Roth IRA and continued until now, as I have learned it is not efficient without the backdoor conversion as this filing status makes me ineligible. I am looking for confirmation that I am filing my taxes correctly for 2024.
- 2022 I paid the 6% excise tax on $4500 in contributions on the Roth IRA. I was ok with this fee at the time not knowing the full extent of the tax code.
- 2023 I paid the 6% excise tax on the $5625 contributions and $4500 (2022) contributions ($10,125) as prompted by Turbo Tax.
As I am filing my taxes for 2024 I have decided to break this pattern and begin investing without penalty in a different retirement account. The steps I have taken or are planning on taking are:
- I have recharacterized all 2024 Roth contributions and one January 2025 Roth contribution as a traditional IRA ($3550).
- This should eliminate the penalty on my 2024 contributions.
- I am withdrawing my excess contributions from 2022 and 2023 ($10,125 exactly). Speaking with a turbo tax professional today they believe that as long as this is done before filing my taxes by the April 15 deadline I will no longer need to report the excess contributions on my 2024 return.
- Is this correct? Or do I still need to pay the 6% on the $10,125 of excess contributions that were in my account as of 12/31/24 on my 2024 return?
- Unfortunately my IRA custodian has no experience with this and I want to make sure I correct this moving forward. Thank you for any advice in advance.
