Contributed too much to your Roth IRA for 2026? Withdraw the excess plus any earnings on it by your tax return due date, including extensions, and you owe no 6% penalty. Miss that deadline and the IRS charges 6% of the excess for every year it stays in the account, and you report it on Form 5329.

How does a Roth IRA over-contribution happen?

Two triggers are the most common for high earners. The first is income. Roth IRA eligibility phases out as your modified adjusted gross income rises, and high earners cross the threshold mid-year without realizing it, often after a raise, a bonus, or a big capital gain. The second is contributing more than the annual limit allows. For 2026, the IRA contribution limit is $7,500, or $8,600 if you are 50 or older, and that limit is shared across all your traditional and Roth IRAs combined.

The 2026 Roth IRA phaseout ranges, from the IRS 2026 limits announcement:

Inside the phaseout band, your allowed contribution shrinks; above it, direct Roth contributions are zero. If your MAGI lands at $250,000 as a joint filer, for example, you are 80% of the way through the $242,000 to $252,000 band. Your allowed contribution drops to $1,500, so $6,000 of the $7,500 you contributed is excess. This is the classic setup: a surprise bonus lands in December after the Roth was already maxed in January.

What is the deadline to fix an excess contribution?

Withdraw the excess contribution plus any earnings attributable to it by the due date of your tax return, including extensions. For a 2026 contribution, that is April 15, 2027, or October 15, 2027 if you file an extension. If you file your 2026 return on time without extending, you still have until October 15, 2027: take the corrective distribution and file an amended return marked "Filed pursuant to section 301.9100-2." This timely corrective distribution is the clean fix described in IRS Publication 590-A: do it in time and the 6% excise tax never applies.

Your IRA custodian calculates the allocable earnings using the IRS net income attributable formula (Treas. Reg. 1.408-11), so do not just pull the contribution amount and call it done. If the account lost value, the net income attributable is negative and you withdraw less than you contributed. Ask the custodian for a "corrective distribution of an excess contribution plus earnings" so it gets coded correctly on Form 1099-R.

What happens if you miss the deadline?

The excess stays in the account and the 6% excise tax under IRC Section 4973 applies for each year the excess remains, as of year-end. The tax is reported on Form 5329, and it repeats annually until you fix the problem. The statute caps the tax at 6% of the account value as of the close of the tax year, so the penalty can never exceed 6% of what is actually in the account.

You have two ways out at that point. You can withdraw the excess (earnings stay; only the excess amount needs to come out after the deadline), or you can absorb it: contribute less than your allowable limit in a later year and apply the unused room against the prior excess. This only works in a year when you are eligible to contribute to a Roth. If your income is still above the phaseout, your allowable Roth contribution is $0, there is no room to absorb, and withdrawal is the only fix. Either way, the 6% tax still applies for every year the excess was in the account at year-end, and it has no reasonable-cause waiver. SECURE 2.0 did add a limitations period: the IRS generally has 6 years from when you file your income tax return for that year to assess the excise tax, even if you never filed Form 5329. File Form 5329 for each affected year rather than relying on that period.

How are the earnings on the excess taxed?

The earnings attributable to the excess contribution are included in your gross income for the year you made the contribution, not the year you withdrew them. Here is the good news Congress added: for corrective distributions made on or after December 29, 2022, by the return due date including extensions, the 10% additional tax on early distributions does not apply to those earnings. Before that date, someone under 59 and a half paid both income tax and the 10% penalty on the earnings; now it is income tax only. Publication 590-A reflects this change.

Should you recharacterize instead of withdrawing?

Recharacterization, moving the contribution to a traditional IRA via trustee-to-trustee transfer, is another path Publication 590-A describes. It makes sense when the problem is income (you were over the Roth phaseout) and you want the money to stay in a retirement account, for example as step one of a backdoor Roth strategy. It does not fix a contribution over the annual limit, because the $7,500 limit is shared across traditional and Roth IRAs. The deadline is the same as for a withdrawal, and the earnings on the contribution must move with it. The mechanics and deadlines are technical, so have your custodian execute the transfer and confirm the coding before you file. Whether the recharacterized contribution is deductible depends on whether you or your spouse is covered by a workplace retirement plan, not only on income. If neither of you is covered, it is fully deductible, though you can still treat it as nondeductible on Form 8606. Before converting, check the pro-rata rule: any pre-tax balances in traditional, SEP or SIMPLE IRAs make part of the conversion taxable.

Pending review by Brian Thomas, EA. Updated September 25, 2026.

This article is free educational content, not tax advice for your specific situation. If you want a plan built around your actual numbers, that is what our paid tax planning engagements do.