Accidentally contributed to Trad IRA instead of Roth

[meic01]

I accidentally transferred money into Trad IRA instead of Roth. Called, but institution couldn't stop/cancel the transfer. Money has not been allocated. Checked with the institution, it is NOT even IN the IRA account yet.

How do I go about moving this back to where it should be: in the Roth?

Recharacterization? Do I need (if any) paperwork? Difficult to do? It's a very small amount. Less than $100. 

thank you

[CesarJ · Accepted solution]

You can fix this by asking the financial institution to recharacterize the contribution from the traditional IRA to a Roth IRA. A recharacterization moves the contribution (plus or minus earnings) as if it were originally made to the Roth, so it's not treated as a withdrawal or rollover.

Here's what to do:

• Contact the IRA custodian and request a recharectarization of the contribution.
• This must be completed by the tax filing deadline (including extensions) for the year of the contribution.

Since the money hasn't been invested yet and is under $100, the process should be simple. 

[meic01]

Thank you so very much!