Hi,
I have a bit of a complex situation. I have two IRAs - a traditional and a roth. I cannot contribute directly to the roth as I exceed the income limits. So I contribute my $6000 max to the traditional and then I do a conversion to the Roth, i.e. the back-door method.
In September I made a mistake and accidentally contributed $1000 directly to the Roth. When I realized this I did a return of excess contribution with my financial institution (T. Rowe). I got the money back but took a bit of a loss. I got about ~$980.
So since in my view I should still have $1000 to contribute (I contributed $6000 and returned $1000). Is this allowed? I tried to do this on T.Rowe but they website will not allow me to initiate a transition because they're saying I hit my contribution limit. They don't appear to be recognizing I did an excess contribution return.
TIA for any advice.
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Once many years ago my sister had a tax-deferred issue with T. Rowe. After talking to a supervisor, they agreed to modify their records, even though it was not strictly permissible. So that worked out. For some reason the supervisor was in a good mood.
Note: the withdrawal of excess ($1,000 exactly) will appear on your 1040 distributions line 4a, along with the amount converted.
Arithmetic will handle your situation.
1,000 + 6,000 - 1,000 = 6,000
You are at your limit, unless you are 50 years old or older
Sheesh.
That's not what I'm saying.
I contributed $6000 total, broken down like this
$5000 correctly to the Traditional
$1000 incorrectly to the roth. ANYTHING I contribute directly to the roth is excess.
I removed the excess contribution to the roth. So since the removal of the excess is supposed to make like the contribution never happened, I would think I still have $1000 left that I can contribute to the traditional. However T.Rowe isn't letting me.
Talk to the broker ... they may need to do an override on their side.
Once many years ago my sister had a tax-deferred issue with T. Rowe. After talking to a supervisor, they agreed to modify their records, even though it was not strictly permissible. So that worked out. For some reason the supervisor was in a good mood.
Note: the withdrawal of excess ($1,000 exactly) will appear on your 1040 distributions line 4a, along with the amount converted.
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