Did I over contribute to trad IRA / backdoor Roth?

[TimTheLandlord]

I contributed $8000 to an IRA (I'm 50+) and the funds grew to $8300'ish - in December I moved all funds in the standard IRA account ($8300) to the Roth backdoor account.  I'm now doing my taxes, and TT is telling me there is an excess of 300 and a penalty involved.

Was I only supposed to transfer exactly $8000 from the traditional IRA into the Roth backdoor and leave the remaining balance ($300) in the standard IRA?

Thanks in advance...

[VolvoGirl]

Sorry wrong post

[DanaB27]

No, you don't need to leave part in the traditional IRA. You can convert the full $8,300. Please make sure you do not select that you moved the fund to a Roth IRA in the IRA contribution interview.

Please review How do I enter a backdoor Roth IRA conversion?

[fanfare · Accepted solution]

Upon reporting a Trad IRA contribution (non-deductible) on your tax return, you can then also report a Roth conversion of the contributed amount for net tax of zero, unless your IRA previously had value exceeding basis.

In that case, it can't be done tax free.

to report a non-deductible contribution, Form 8606 must be attached.

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Since you converted an extra 300, you pay tax on that. there is no penalty for doing that.

@TimTheLandlord 

[TimTheLandlord]

I just got off the phone with Fidelity, the representative said there is not Roth IRA contribution limit so contributing $8300 should not be an issue.  The $8000 is the Federal limit for Traditional IRA.  It sounds like I pay the tax on the $300 and I'm good - I must have entered it incorrectly previously to get to the penalty message. Thanks for the help.

[fanfare]

The $8000 is also  the Federal limit for Roth IRA contribution. 

You did not do a Roth contribution.

[VolvoGirl]

And Actually 8,000 is the limit for both Traditional IRA and ROTH IRA  COMBINED.  Not 8,000 each.  But that doesn't apply to conversions or rollovers.