Deadlines

The deadlines concerning Roth IRAs are discussed in this section of Roth IRAs information website. Roth IRA rules are different from traditional IRA rules and the deadlines associated with Roth IRAs are also different from traditional IRAs.

What is the deadline for recharacterizing an IRA contribution?

A recharacterization may be accomplished by the due date of the tax return including extensions (or later if authorized by the IRS). If you timely file your tax return without recharacterizing, the IRS will allow you an additional 6 months (until October 15) to make the transfer.

Tax Form 1040X (Amended U.S. Individual Income Tax Return) may be required if your client had already filed tax Form 1040 and an IRA deduction is being taken or recharacterized.

If you must file Form 1040X, write "filed pursuant to section 301.9100-2" on the amended return and file it at the same place you filed the original return.

The deadline to recharacterize a contribution corresponds with the year for which the contribution was intended, not the year in which the contribution was made.

For example, the deadline to recharacterize a contribution made in February 2004, designated for calendar year 2003, is the deadline for filing the individual's 2003 Federal income tax return (April 15, 2004), including extensions. (Please note, this deadline is different from the deadline to remove an excess contribution.

The deadline to remove the contribution in this example as an excess is the deadline for filing the individual's 2004 Federal income tax return (April 15, 2005), including extensions.

Is a recharacterization treated as a rollover for purposes of the 60 day rule?

No.

A recharacterization of a Roth IRA contribution does not count as an IRA rollover.

How is a recharacterization reported for tax purposes?

A Form 1099-R is issued in the year of the recharacterization. Each recharacterization of an IRA or Roth must be reported as an IRA distribution on line 15a of Form 1040.

 Since the assets were transferred to a second IRA account, the amount taxable on Form 1040, line 15b is zero.

If a Roth IRA contribution is being recharacterized, you might have to complete Form 8606.

The instructions to Form 8606 require that a statement be attached to the tax return explaining the specific details of the recharacterization.

For example, for a recharacterized contribution, a tax payer must attach a statement that shows the total amount recharacterized broken down between earnings, contributions and the deductible amount if any.

The custodian of the first IRA account issues a Form 5498, Roth IRA Contribution Information, for the tax year in which the Roth IRA contribution was made.

The custodian of the second IRA will also issue a Form 5498 to report the recharacterized contribution.