IRA recharacterization and SEP IRA contribution
Is it possible to recharacterize a 2020 Roth IRA contribution to a traditional IRA contribution that won’t be deducted because my income is too high, and also make a SEP IRA contribution for 2020?
Is it possible to recharacterize a 2020 Roth IRA contribution to a traditional IRA contribution that won’t be deducted because my income is too high, and also make a SEP IRA contribution for 2020?
Permalink Submitted by Alan - IRA critic on Mon, 2021-02-08 22:09
Yes, these transactions are unrelated. Since a SEP IRA is technically a TIRA with special contribution limits, the recharacterized Roth contribution could even be transferred into the SEP IRA as a non SEP regular IRA contribution. One type of recharacterization not allowed is for a SEP contribution to an IRA contribution or vice versa because a SEP contribution is an employer contribution, not a personal contribution.