Excess contribution and Backdoor Roth conversion in same year

[marychris]

Hi there, 

I'm looking to make a non deductible contribution to a traditional IRA and then convert it to a Roth IRA, since I exceed the income thresholds.  However, there was an excess contribution earlier this year in a prior Roth IRA (not my fault, the IRA provider moved the money to the wrong account). It's since been corrected and the Roth was closed.

However, now that I want to do a backdoor Roth, having just recently learned about them, is it going to cause any IRS issues that I'm opening a new Roth in the same year, since I previously had an excess contribution in the old Roth? This would be a new Roth with the same IRA provider.

Thank you!

[macuser_22]

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@marychris wrote:

Hi there, 

I'm looking to make a non deductible contribution to a traditional IRA and then convert it to a Roth IRA, since I exceed the income thresholds.  However, there was an excess contribution earlier this year in a prior Roth IRA (not my fault, the IRA provider moved the money to the wrong account). It's since been corrected and the Roth was closed.

However, now that I want to do a backdoor Roth, having just recently learned about them, is it going to cause any IRS issues that I'm opening a new Roth, since I previously had an excess contribution in the old Roth? This would be a new Roth with the same IRA provider.

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Possibly.

Where was the money moved to?  What type of account?

[marychris]

Originally, the money was transferred from my bank to the Roth instead of from the bank to my HSA, as I had wanted to make an HSA contribution. I called the provider as soon as I saw the money had hit the Roth and had the money returned back to my bank account after completing the excess contribution form.

[macuser_22 · Accepted solution]

Then it should not cause any problem.

[marychris]

Whew! Thank you 🙂