How to Undo a Roth IRA Contribution if Your Income is Too High

By Kimberly Lankford

| Photographs By IPGGutenbergUKLtd/IPGGutenbergUKLtd

QUESTION: I know I can’t undo conversions from a traditional IRA to a Roth anymore. But what if I contribute to a Roth and then discover my income is too high? — J.C., East Lansing, Mich.

ANSWER: Even though the new tax law prohibits people from undoing a conversion they made from a traditional IRA to a Roth after Dec. 31, 2017 (called recharacterizing), you can still recharacterize a Roth contribution and move the money to a traditional IRA.

You can contribute to a Roth IRA if your modified adjusted gross income in 2018 is less than $135,000 if you’re single or $199,000 if you file jointly.

If you contribute to a Roth but your income is too high, you can ask your IRA administrator to move your Roth contribution (and any earnings on it, which your administrator will calculate) into a traditional IRA before the deadline to file your tax return for the year of your contribution.


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Copyright 2018 The Kiplinger Washington Editors. This article was written by Kimberly Lankford from Kiplinger and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to legal@newscred.com.

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