I retired in 2024. I did not have any earned income in 2025; but continued to contribute to a Traditional IRA ($2400 for 2025). How do I fix this?!?

[edoltmann]

I contributed to a Traditional IRA in 2025 even though I am retired and have no "earned income".

[ReneV4 · Accepted solution]

In order to contribute to your IRA, you (or your spouse, if applicable) need to have earned income. 

Passive income, such as social security, pensions and dividends do not count.

To fix this: 

1. Stop contributing to your IRA, unless you have earned income
2. Request the return of excess contribution plus earnings with your financial institution to get the correct 2026 Form 1099-R issued

The returned contribution will not be taxable, but the earnings will be taxable in the year the contribution was made. 

If you request the return of excess contribution, plus earnings by the due date, you do not need to enter the IRA contribution under Deduction and Credits.

If you do not withdraw the funds, you will be charged a 6% penalty each year the amount stays in your account.