For the year 2013, we made a excess contribution of 4992 in the ROTH IRA but realized late march of 2014 that we were not eligible to ROTH IRA because of our AGI. We removed the money from the the ROTH IRA before April 15th but need help to figure out how to report taxes. Based on the IRS document, the taxes for any income earned from the ROTH IRA would need to be reported in 2013 tax returns. We filed an extension in April so we could figure out how to report this. Also, I don't have any paperwork and wont be receiving it until early 2014. How do I report this so I can pay the taxes on the income earned which was 881.46. Also, would there be a penalty in addition to the taxes that I will pay. Appreciate everyone's help.
USA Excess contribution to ROTH IRA
- Thread starter SHAJA
- Start date
From what I remember about ROTH IRAs, it is post tax income that is contributed, so I don't see what the problem would be. You've already paid taxes on the amount contributed, so it shouldn't be an issue tax-wise.
As far as interest/revenues earned while the money was in the ROTH. Well, you could just treat it as an early withdrawal and let the penalties kick in. I'm sure those would be more than the actual taxes due on the income produced. Then, in 2014 once you have all the exact info on the income on 2013, you can file an amended return for 2013.
As far as interest/revenues earned while the money was in the ROTH. Well, you could just treat it as an early withdrawal and let the penalties kick in. I'm sure those would be more than the actual taxes due on the income produced. Then, in 2014 once you have all the exact info on the income on 2013, you can file an amended return for 2013.