That might not work, but there is another way she can keep the Roth contribution. You probably can't make an IRA contribution because the same law that limits whether or not you can contribute to a Roth can also limit the amount of deductible contribution you can make if either of you is covered with a pension plan at your job.
However, if she is overfunded on the Roth contribution, you can recharacterize her contribution rather than withdraw it. A recharacterization treats the original Roth contribution as having never happened, but treats it as if you had originally contributed to a nondeductible TIRA. After this is done, you can immediately convert the recharacterization back into a Roth. This technique, known as a back-door Roth contribution, gets around the income limitation for contributing directly to a Roth IRA.
There is extra reporting required when you do this: the recharacterization itself will get reported on a 1099-R that you will see next year, and the conversion also gets reported. (One caveat to this: growth on the IRA, since it is now a nondeductible TIRA, will be included as taxable income upon conversion. However, your contribution limits for 2019 remain intact).
If you choose to go this route, you have until April 15th to recharacterize the original Roth contribution. You do not need to convert the TIRA back into a Roth immediately, but, any growth in the IRA will be taxable, so I recommend doing the recharacterization and the conversion consecutively if that's possible.
And then your wife does not lose her Roth IRA.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
