topic I have a roth that i fully fund. I accidentally sent some money to an IRA that i have at another financial institution. What do i do...take the money out of the IRA? in Retirement tax questions

I have a roth that i fully fund. I accidentally sent some money to an IRA that i have at another financial institution. What do i do...take the money out of the IRA?

doug3 — Sat, 01 Jun 2019 06:58:51 GMT

Yes, if you have contributed more than your annual limit...

DexterS — Sat, 01 Jun 2019 06:58:53 GMT

Yes, if you have contributed more than your annual limit to all your IRAs, you need to have the custodian return the money to you, and any earnings associated with it.

The IRS charges taxpayers an over-contribution penalty if they contribute more than the annual maximum.

ok..once the custodian returns the money, will turbo tax...

doug3 — Sat, 01 Jun 2019 06:58:55 GMT

ok..once the custodian returns the money, will turbo tax walk me through this situation and apply necessary forms? I read where IRS will not charge if I correct it before I file?

That's correct, there's no penalty if you withdraw before...

DexterS — Sat, 01 Jun 2019 06:58:57 GMT

That's correct, there's no penalty if you withdraw before the filing deadline. Do not deduct the amount you're withdrawing on your 2016 tax return.

Because you will be getting the over contribution back in 2017 you will receive a 1099-R in 2018, for 2017. It will be coded such that you will only be taxed on any earning that are attributed to that contribution.