IRA rollover

user17610548198 — Wed, 22 Oct 2025 22:16:50 GMT

A couple of years ago I rolled a small IRA ($5900) that was bought with post tax funds into my traditional IRA. Is it possible to have that IRA recharacterized as a ROTH instead of just an IRA 2 years later?

Re: IRA rollover

Mark_5 — Wed, 22 Oct 2025 23:17:32 GMT

"Recharacterization" is a transaction that allows you to treat a contribution made to one type of IRA (Traditional or Roth) as having been made to the other type. The deadline for recharacterizing an IRA contribution is generally the tax-filing deadline (including extensions) for the year the contribution was made. This is typically October 15th of the following year.

Since you are two years past the rollover and original post-tax contribution date, the window for a recharacterization of the original contribution has almost certainly closed.

However, you have a separate option to consider: a Roth Conversion.

Roth Conversion: A Roth conversion is a process where you move assets from a Traditional IRA (or other pre-tax retirement accounts) into a Roth IRA.

After-Tax Funds: The original $5,900 you rolled over was from post-tax funds, which means you have already paid taxes on that principal.

Taxable Amount: When you convert, you generally only pay income tax on the earnings that have accrued in the Traditional IRA since the rollover, not the original after-tax principal. The original $5,900 itself should not be taxed again, as long as you've properly filed IRS Form 8606 to track your non-deductible (after-tax) contributions (your "basis").

Pro-Rata Rule: If you have any other pre-tax money in any of your Traditional IRAs (including SEP and SIMPLE IRAs), the conversion will be subject to the pro-rata rule. This rule requires that a portion of the amount you convert be considered pre-tax and therefore taxable, even if you are only converting the after-tax funds. The calculation is based on the total value of all your Traditional IRAs.

Irreversible: Roth conversions made after 2017 cannot be recharacterized (undone).

Deadline: There is no income limit to do a Roth conversion, and the deadline for converting in a given year is December 31st of that year.

In summary:

Recharacterization: Likely not possible due to the time that has passed (two years).
Roth Conversion: This is the current, available path to move your funds to a Roth IRA.
- You will pay income tax on any earnings in the Traditional IRA.
- The conversion may be partially taxable if you have any other pre-tax funds in any of your Traditional IRAs (the pro-rata rule).
- The converted amount is included in your taxable income for the year of conversion.

It is highly recommended that you consult with a qualified tax professional or a financial advisor to understand the specific tax implications of a Roth conversion, especially regarding the reporting of your after-tax basis on Form 8606 and the potential impact of the pro-rata rule.

topic IRA rollover in Retirement tax questions

IRA rollover

Re: IRA rollover