Contributing to Roth IRA directly with income over limit

[liu3222]

I made a direct contribution of $6500 to my Roth IRA account for tax year 2023 directly in April 2024 (after filing my tax return for 2023). Later in October 2024 I made another direct contribution of $7000 to my Roth IRA account for tax year 2024.

However I realized that my income is over the limit for direct contribution to Roth IRA for both tax year 2023 and tax year 2024. Hence I called my broker to reacharacterize the contribution for tax year 2024 as Traditional IRA in January 2025. However for the contribution of tax year 2023, they said that it has passed the deadline for recharacaterization, hence I choose to remove the contribution of tax year 2023 from my Roth IRA.

Now I am preparing my tax return for tax year 2024. My question is:

1) what should I do with my tax year 2024 return, should I pay penalty for the $6500 Roth IRA contribution made for tax year 2023?

2) should I amend my tax return for tax year 2023? I am getting contradicting answer online as some claim that I do not need as I made the direct contribution in 2024, other said that I need to amend as the contribution was for tax year 2023.

Thanks in advace for the help!

[MinhT1]

For the excess contribution of $6,500 for 2023, you have to pay the excise tax of 6% for tax years 2023 and 2024.

For tax year 2023, you'll need to file an amended return to report the excess contribution and pay the 6% tax.

For tax year 2024, as the excess for 2023 still remained in your account as of 12/31/24, you will need to report it on form 5329 and pay the 6%. 

For the excess contribution of $7.000 for 2024, as you have recharacterized it before April 15, you'll have to report it as a nondeductible Traditional IRA contribution on form 8606.