The title of this question might not make sense, so let me explain. The "excess" contribution here refers to the full 6000 (filing as single) amount in the situation in which the person is not eligible to contribute at all to a Roth IRA (due to income limits). In other words, because I am not able to contribute to a Roth IRA at all, the full contribution of 6000 is the "excess" contribution.

In short, my question is as follows:

Despite being ineligible to contribute anything at all due to income limits, I contributed 6000 to my Roth IRA in 2019. If I take out the full 6000, plus earnings, will the amount I have contributed in 2019 become 0, and therefore will be allowed to make a non-deductible contribution of 6000 to the Traditional IRA and mark it for 2019?

Indeed, re-characterization is possible in this situation. However, I want to maintain a 0 balance in my Traditional IRAs to allow for backdoor Roth IRA conversions in the future. So ideally, I don't want to move any money into a Traditional IRA.

High level situation:

  • cannot deduct Traditional IRA due to income limits (but I can make a non-deductible Traditional IRA contribution, which is allowed no matter your income)
  • cannot contribute at all to Roth IRA due to income limits
  • single (cannot be claimed as dependent, but also not head of household)
  • already contributed 6000 to Roth IRA in 2019 (too late to change)
  • currently have a 0 balance in all my Traditional IRAs (which I want to maintain at 0, so as to allow backdoor Roth IRA conversions in the future)

So my plan is as follows:

  1. Take out the 6000, plus earnings.
  2. Pay 10% penalty plus taxes on the earnings.
  3. Make non-deductible contribution of 6000 into Traditional IRA and mark it for 2019.
  4. Immediately convert the 6000 in the Traditional IRA into Roth IRA.
  5. Fill out 8606 to mark the 6000 as non-deductible, and thereby making the conversion a non-taxable event.

So, long story short, the question of this post boils down to:

Is step (3) allowed? That is, will I be able to make that 6000 non-deductible contribution, since my contribution of 2019 has effectively become 0 after taking out the 6000 Roth IRA contribution? Or will I not, because the Roth IRA contributions are still counted, despite being taken back out at the end?


You do not need to withdraw, you can recharacterize your contribution as a Traditional IRA then roll it over to a Roth.

Contact the brokerage.

Source: https://investor.vanguard.com/ira/ira-recharacterization

  • Thanks for the answer! In this case, is re-characterization the same as a contribution? Specifically, if I re-characterize as a Traditional IRA, will I then be able to fill out the 8606 for the 6000, and then do a rollover, paying taxes only on the earnings and not the 6000? – nehcsivart Feb 19 '20 at 7:08
  • It seems the answer to my question in the above comment is yes: irs.gov/instructions/i8606#idm140064693735872. In this case, this re-characterization + rollover approach will be much more tax/penalty efficient than my original plan. Thanks! – nehcsivart Feb 19 '20 at 7:30
  • One significant difference between a Roth IRA contribution and the Trad IRA to Roth conversion is that converted funds must remain in the Roth for 5 years to be withdrawn without penalty. If you are planning on leaving the money in the account for a long time anyway (i.e. retirement planning), this is a non-issue in most cases. – R. Hamilton Feb 19 '20 at 17:29
  • @R.Hamilton: "One significant difference between a Roth IRA contribution and the Trad IRA to Roth conversion is that converted funds must remain in the Roth for 5 years to be withdrawn without penalty." But only on the portion of the conversion that was taxable. If the conversion was completely non-taxable (as it is in a proper backdoor Roth IRA contribution), then there is no penalty to withdrawing it within 5 years. – user102008 Feb 20 '20 at 3:34

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