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Retirement tax questions
Your 1099-R with the code N does not fit the facts you gave.
The code "N" says that a 2017 Roth contribution made *in* 2017 *for* 2017 was recharacterized not the contribution *in* 2017 *for* 2016 which would have a code "R".
If you also made a $5,500 2017 Traditional IRA contribution then according to the 1099-R's you made two 2017 contributions totaling $11,000 - exceeding the 2017 contribution limit.
You need to talk to Vanguard about this if they issued a code N when it should have been a code R.
Did Vanguard actually post the 2016 Roth contribution made *in* 2017 as a 2016 contribution or a 2017 contribution in error? If they did then they should have refused a 2nd 2017 Traditional IRA contribution because that would exceed the limits.
From the 2 1099-R's it would appear that Vanguard treated both contributions as 2017 contributions, recharacterized the Roth to a Traditional IRA and then reported the $11,000 Traditional IRA distribution resulting in two $5,500 2017 contributions that is not allowed.
Either they posed the 2016 contribution wrong or the 1099-R with the code N is in error.
The code "N" says that a 2017 Roth contribution made *in* 2017 *for* 2017 was recharacterized not the contribution *in* 2017 *for* 2016 which would have a code "R".
If you also made a $5,500 2017 Traditional IRA contribution then according to the 1099-R's you made two 2017 contributions totaling $11,000 - exceeding the 2017 contribution limit.
You need to talk to Vanguard about this if they issued a code N when it should have been a code R.
Did Vanguard actually post the 2016 Roth contribution made *in* 2017 as a 2016 contribution or a 2017 contribution in error? If they did then they should have refused a 2nd 2017 Traditional IRA contribution because that would exceed the limits.
From the 2 1099-R's it would appear that Vanguard treated both contributions as 2017 contributions, recharacterized the Roth to a Traditional IRA and then reported the $11,000 Traditional IRA distribution resulting in two $5,500 2017 contributions that is not allowed.
Either they posed the 2016 contribution wrong or the 1099-R with the code N is in error.
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
‎June 4, 2019
11:15 PM