Hello-

Individual made a Roth contribution and then withdrew it because income was too high. Custodian classified it as a withdrawal not a return of excess. They put the money back into the Roth as a 60 day rollover.

1. They are planning to extend their tax return and recharacterize that money to a Traditional IRA and then convert to the Roth as a Backdoor Roth. They have no other IRAs of any kind. Is that plan appropriate?

2. When calculating earnings on a contribution do you look at all Roth IRAs combined or just at the earnings in that specific Roth. For example, if they set up a separate Roth and put $6,000 in and then never invested it they would have no earnings to adjust even if they had other Roths that were invested correct?

Thank you!