Can Excess Roth Contribution be Converted Back to Roth?

I have a client who made a 2015 Roth contribution. At tax time, he discovered he wasn’t eligible and that it was an excess contribution. So in April 2016, the positions were journaled to a non-deductible IRA. Do these funds have to remain in the non-deductible IRA or can they be ‘back-doored’ back to the Roth? He has no other IRA money.



He can convert the entire TIRA balance to Roth. The amount of the recharacterized contribution should have been reported on a 2015 8606 as a non deductible contribution. This amount will not be taxed in the conversion. Any gains in the TIRA on the original contribution (the amount converted that exceeds the basis on Form 8606) will be taxable.



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