- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Report Inappropriate Content
If contributed excess to traditional ira but didn’t report excess on 2016 filing and also have not taken excess out yet, do I need to amend 2016 or can I correct on 2017?
Contributed 5,700 but only reported max 5,500 In 2016
Do you have an Intuit account?
You'll need to sign in or create an account to connect with an expert.
- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Report Inappropriate Content
If contributed excess to traditional ira but didn’t report excess on 2016 filing and also have not taken excess out yet, do I need to amend 2016 or can I correct on 2017?
You need to amend your 2016 tax return to report the $200 excess contribution made for 2016 and pay the 6%, $12 penalty. Unless you can apply this $200 as part of your traditional IRA contribution for 2017, the excess must again appear on your 2017 Form 5329, subject to another 6%, $12 penalty. If you can't apply it as part of your 2017 contribution, to avoid another 6% penalty for 2018, you'll need either be able to apply it as a 2018 contribution or obtain a regular distribution of $200 from your traditional IRA, taxable and subject to a 10% early distribution penalty. A return of contribution after the due date of your [2016] tax return is not permitted to be nontaxable because your contribution in 2016 exceeded $5,500.
If you made the maximum traditional IRA contribution for 2017, you can obtain a "return of contribution"(not a regular distribution) of $200 of that contribution, with the distribution being adjusted for any gain or loss, to make room to allow the $200 excess from 2016 to be applied as part of your 2017 contribution.
Still have questions?
Make a post