Fix backdoor Roth excess: rollover Roth 2022 to 2024?

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  • #93620 Reply

      I messed up a backdoor Roth with Fidelity and need advice. I didn’t realize that dates for contributing are different when doing a backdoor and tried funding a traditional IRA for both 2022 and 2023 in March of last year. I converted all 12,500 (plus a few dollars in gains) into a Roth IRA the same month.

      Now, it looks like I’m going to get hit with a penalty every year for over contributing until it’s fixed. My question is, how do I fix it? It’s not as easy as moving it out of the traditional IRA that I overfunded, because it’s no longer in that account (it’s in the Roth IRA).

      Can I move money in my Roth IRA from the 2022 to the 2024 “bucket,” and if so, how? Or do I need to pull money out of the Roth IRA ($6006) and then put it back in under this year’s total? And how do I indicate to the tax powers that be that I’ve taken care of the issue?

      #93621 Reply

        What you did is completely allowed. Are you doing your own taxes with tax software?

        If so, something has probably been entered incorrectly for form 8606. You want to make sure you are putting the correct amounts for the correct year. The questions on some software can be very confusing, so my assumption is that that is where this fear of overcontributing is coming from.

        If this is the case, the fix is correcting whatever was entered into your taxes, not moving money.

        #93622 Reply

          The dates aren’t different. Talk to someone qualified (probably not many in this group), and walk them through the exact sequence of events.

          The only way you could have over-contributed is if you also funded the Roth for the same years, had an employer fund one or the other, or had multiple IRAs open simultaneously (so the brokerage couldn’t enforce the contribution limits).

          #93624 Reply

            I know we over contributed and called and asked for it saying we did that. It’s a form one person said but idk since it was hubby and over phone, then hope for the best is what I’m doing.

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