In 2024, my employer provided a 50% match on all 403(b) contributions.
I put in roughly 2k USD into the program before being terminated.
I received a notice that my 2k + 1k match was being held in a retirement clearing house in 2025. They provided me with a check made payable to my IRA custodian.
I called my IRA custodian and put the ~3k in my Roth IRA, no questions asked.
Now, I realized this money was pre-tax because my FY24 W-2 shows the ~2k deducted from my taxable income.
what should I do? One of my first years paying taxes as a member of the workforce.
Accidentally made a ~3k USD pre-tax contribution to my Roth IRA. What do I do?
byu/Traditional-Tart1470 intax
Posted by Traditional-Tart1470
2 Comments
You can talk to your IRA custodian and explain it was a pre-tax contribution. They can probably correct it and move it to a Traditional IRA. Don’t panic, this happens to people new to taxes.
Your custodian might be able to reassign it, but if not, basically it sounds like you made a Roth IRA conversion. So you have $3000 in taxable income, but the funds now grow tax free going forward in your Roth IRA.
ALSO – you did not make a “contribution.” This is a rollover/transfer, and a conversion. This does NOT impact your contribution limit, you can still contribute up to the full limit.