Thank you so much for your valuable advice! Yes- the ENTIRE balance of the Roth IRA at Brokerage B was transferred to a previously empty Roth IRA at brokerage A. That $7,000 contribution in Janu...
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Thank you so much for your valuable advice! Yes- the ENTIRE balance of the Roth IRA at Brokerage B was transferred to a previously empty Roth IRA at brokerage A. That $7,000 contribution in January 2024 was for 2024 and meant for recharacterization now. I did file extension for 2024 tax return. I contributed $7000 in Jan 2024 for that needs to be recharacterized now, and I also contributed $7000 in Jan 2025 that is meant for 2025 and do not wish to recharacterize this. Question: I wonder if the AOB is $12,000 + $7,000 + $7,000 = $26,000 is fair because the contribution $7000 in Jan 2025 were not part of the balance when the 2024 contribution started growing. Should we exclude the 2025 contribution's impact? My account now has 2 contributions (2024, 2025) and I just want to recharacterize the 2024 contribution, is the following correct? NIA=C×[(A−B)/B] Where: C = Amount of the contribution I want to recharacterize ($7,000 for 2024) A = Current value of the entire Roth IRA at recharacterization time B = Value of the Roth IRA when the 2024 contribution was made, including that contribution Since I don't want to recharacterize the 2025 contribution, should I adjust both A and B to exclude: The 2025 contribution amount ($7,000) Any earnings or losses associated with that 2025 contribution So my adjusted values would be: Adjusted A = $26,604 - $7,000 - (any earnings on 2025 contribution) Adjusted B = $12,000 + $7,000 = $19,000