Roth IRA Recharacterizations

An account owner may recharacterize a current year contribution to a Roth IRA by transferring the contribution plus earnings to a Traditional IRA. Furthermore, an account owner may reverse a conversion made to a Roth IRA by transferring the converted amount plus earnings back to a Traditional IRA. A taxpayer may recharacterize regular contributions or conversions if he or she is ineligible for the original transaction, or if he or she merely wishes to change his or her mind. A taxpayer is permitted to recharacterize all or just a portion of a regular contribution or conversion and the earnings attributable to that portion.

Recharacterizations may only be done in a trustee to trustee transfer and must be accomplished on or before the due date (including extensions) for filing the account owner’s Federal income tax return for the taxable year for which the contribution was made.