topic I am entering mine and my husband's 2025 Roth contribution and it decreases my refund. I'm not sure how or why this is happening. in Retirement tax questions

I am entering mine and my husband's 2025 Roth contribution and it decreases my refund. I'm not sure how or why this is happening.

gwen-green — Mon, 16 Feb 2026 21:23:02 GMT

I've went back and taken it out and started over and it does it each time decreasing our refund by about two hundred dollars for each 8k Roth contribution.

Re: I am entering mine and my husband's 2025 Roth contribution and it decreases my refund. I'm no...

MindyB — Mon, 16 Feb 2026 22:12:22 GMT

Since Roth contributions are made with after-tax money, they don't provide a tax deduction to lower your bill. The most likely reason your refund is dropping is that your income exceeds the 2025 eligibility limits, causing a 6% excise tax penalty for an "excess contribution." Essentially, if you earned too much to qualify for a Roth, the IRS charges you a fee for putting money into one.

Here are the Roth limits: Amount of Roth IRA contributions that you can make for 2024

Re: I am entering mine and my husband's 2025 Roth contribution and it decreases my refund. I'm no...

dmertz — Mon, 16 Feb 2026 23:17:45 GMT

Either your modified AGI for the purpose exceeds the threshold above which you are ineligible to contribute the amount contributed you you have insufficient compensation (income reported on a W-2 or net earnings from self-employment) to support the contribution.

Re: I am entering mine and my husband's 2025 Roth contribution and it decreases my refund. I'm not sure how or why this is happening.

gwen-green — Tue, 17 Feb 2026 01:03:45 GMT

That's exactly the reason! I had no idea we were that close and we were over by 1k due to a retirement vacation payout. Thanks for the responses. Luckily I was able to go in and adjust the Roth deposits and get a refund of the overage.