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IRA Rollover after 60 days

Forum|Forum|1 year ago
February 18, 2025
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I had an direct rollover of my Roth IRA to a Traditional IRA. For some reason it took 9 months for it to happen. I wasn't aware that it wasn't done with the 60 day window. How to I show that on my taxes since I did roll it all over but it was not within 60 days. I also never received a check, it sat in my Roth for 9 months before officially rolling over.

Best answer by dmertz

"I had an direct rollover of my Roth IRA to a Traditional IRA."

Not sure what you mean here. A Roth IRA is not permitted to be rolled over to a traditional IRA. Doing so creates an excess contribution to the traditional IRA to the extent that it exceeds the amount you are eligible to contribute to a traditional IRA for the year. Additionally, it would make no sense to take a distribution from a Roth IRA only to make a regular contribution to a traditional IRA unless the distribution from the Roth IRA was to correct an excess Roth IRA contribution, in which case it would not be a rollover.

The term "direct rollover" technically only applies to a rollover to or from an employer plan like a 401(k). There is no 60-day deadline to complete a direct rollover. Still, you are not permitted to do a rollover to a traditional IRA from a designated Roth account in an employer plan.

Perhaps what you did was a recharacterization, not a rollover. Again there is no deadline to complete the transfer. However, when doing a recharacterization from a Roth IRA to a traditional IRA the funds must generally leave the Roth IRA by the due date of the corresponding tax return, including extensions.

D

dmertzAnswer

Employee

"I had an direct rollover of my Roth IRA to a Traditional IRA."

Not sure what you mean here. A Roth IRA is not permitted to be rolled over to a traditional IRA. Doing so creates an excess contribution to the traditional IRA to the extent that it exceeds the amount you are eligible to contribute to a traditional IRA for the year. Additionally, it would make no sense to take a distribution from a Roth IRA only to make a regular contribution to a traditional IRA unless the distribution from the Roth IRA was to correct an excess Roth IRA contribution, in which case it would not be a rollover.

The term "direct rollover" technically only applies to a rollover to or from an employer plan like a 401(k). There is no 60-day deadline to complete a direct rollover. Still, you are not permitted to do a rollover to a traditional IRA from a designated Roth account in an employer plan.

Perhaps what you did was a recharacterization, not a rollover. Again there is no deadline to complete the transfer. However, when doing a recharacterization from a Roth IRA to a traditional IRA the funds must generally leave the Roth IRA by the due date of the corresponding tax return, including extensions.

V

vaccartc3Author

@dmertz yes, I had an excess in my Roth IRA contributions and that was converted to my traditional IRA. It looks like what I did was a recharacterization instead of a rollover. Thank you for clarifying for me!

D

dmertz

Employee

Given how investments in a Roth IRA can gain or lose value over time, it's a bit irresponsible of the IRA custodian to not timely perform the recharacterization after you made a proper request to do so. However, as long as the recharacterization was performed by the due date of the corresponding tax return, including extensions, the recharacterization was otherwise completed properly.