topic Over contribution to Roth IRA 2022: need help for amended tax return and excess removal in Get your taxes done using TurboTax

Over contribution to Roth IRA 2022: need help for amended tax return and excess removal

lolo1231 — Tue, 24 Feb 2026 07:11:27 GMT

I contributed to a Roth IRA in excess for 2022: Instead of contributing to the "traditional" IRA and using a "conversion to Roth", I made the mistake of contributing directly to the Roth IRA. I filed the return in April but now would like to amend return.

I think I need to remove the excess thru https://investor.vanguard.com/investor-resources-education/iras/excess-contribution. Is that correct? (Or can I do a recharacterization to traditional IRA and convert it to Roth IRA now for 2022, if that's possible?)

After the excess removal (or recharacterization), what steps shall I follow?

1. Will Vanguard provide me with a document about the excess removal? If so, what's the document called? How long does it take for this removal typically to "take effect"?

2. After the removal, I think I need to file an amended tax return. How do I do that thru Turbotax?

3. How do I tell Turbo tax about the "excess removal"? If there are capital gains, how do I tell Turbotax about it? Will I need to upload a document from step 1? Or do this manually?

Re: Over contribution to Roth IRA 2022: need help for amended tax return and excess removal

fanfare — Sun, 06 Aug 2023 23:29:43 GMT

goto Vanguard -> Forms and applications

click search using keyword.

search for "Excess"

It will tell you what your options are.

Recharacterization is also an option, followed by, optionally, the election for non-deductible IRA contribution.

Backdoor Roth conversions only works if all your current traditional IRA(s) are empty.

Re: Over contribution to Roth IRA 2022: need help for amended tax return and excess removal

Hal_Al — Mon, 07 Aug 2023 13:21:39 GMT

paging @dmertz

Re: Over contribution to Roth IRA 2022: need help for amended tax return and excess removal

fanfare — Mon, 07 Aug 2023 13:49:23 GMT

return of excess contribution:

before tax due date including extensions: positive earnings allocable to the excess are taxable on the Line 4b for the year of the contribution. negative earnings are ignored; in which case, for purposes of basis, consider the original requested amount as returned.

for 2022, positive earnings removed arer penalized 10% if you are under age 59 1/2. (eliminated for 2023)

recharacterization: the original amount to the first IRA you report as contribution to the second IRA, earnings are ignored.
report this on your tax return for the year during which the contribution was made.

Evidently , Vanguard now wants you to submit your "request forms" online instead of US mail.

@lolo1231

Re: Over contribution to Roth IRA 2022: need help for amended tax return and excess removal

dmertz — Mon, 07 Aug 2023 14:04:36 GMT

As long as you filed your tax return or requested a filing extension by April 18, 2023, you have until October 16, 2023 to perform a recharacterization of the Roth IRA contribution to a traditional IRA contribution or to obtain a return of contribution before the due date (including extensions) of your excess Roth IRA contribution made for 2022.

1. I'm sure that Vanguard has a procedure for performing either of these corrective transactions. If you do a recharacterization, it's treated as if the original Roth IRA contribution had at that time been made to a traditional IRA instead. If you obtain a return of contribution, it's treated as if the contribution had not been made except that any investment gains required to accompany the contribution being returned will be taxable. Either way Vanguard should calculate the amount of attributable gains to be transferred or distributed, depending on which corrective action you take. Vanguard will issue a 2023 Form 1099-R near the end of January 2024 to report the transfer or distribution. If you receive a return of contribution, make sure that no taxes are withheld. Tax withholding on such a distribution is an unnecessary complication.

2. If you recharacterize, you certainly need to amend your 2022 tax return to either include the resulting traditional IRA contribution as a deduction, if permissible, or as a nondeductible contribution. If you obtain a return of contribution and the distributions includes attributable gains, the gains will be taxable on the tax return of the year in which the contribution was made. If you file an amended 2022 tax return, it needs to include the statement, "Filed pursuant to section 301.9100-2."

3. When amending in TurboTax, enter the Roth IRA contribution as originally made, then indicate that you either switched the contribution to be a traditional IRA contribution instead or you "withdrew" the excess. If attributable gains are distributed and the contribution was made in 2022, you'll also need to enter the code JP 2023 Form 1099-R (as if you have already received it if you file the amendment before receiving the Form 1099-R) so that TurboTax will add the taxable gains to your 2022 income. You'll also need to claim an other-reason exception to the early-distribution penalty because the SECURE 2.0 Act eliminated the penalty under these circumstances regardless of your age.

Re: Over contribution to Roth IRA 2022: need help for amended tax return and excess removal

fanfare — Mon, 07 Aug 2023 16:49:07 GMT

once you submit the form correctly it is processed immediately (few business days)

I found that T Rowe Price, when it doesn't like the form, silently ignores it, without telling you.

After two weeks I sent a question via website and found out about the problem that way.

Not very customer friendly.

(maybe they called the phone number, if they did, we missed it.).

Also, T Rowe Price won't cooperate with executors.