Comments on: Unromantic Money and Tax Talk before Marriage http://blog.equifax.com/tax/unromantic-money-and-tax-talk-before-marriage/ Wed, 22 May 2013 10:50:49 +0000 hourly 1 http://wordpress.org/?v=3.5 By: Eva Rosenberg, EA http://blog.equifax.com/tax/unromantic-money-and-tax-talk-before-marriage/#comment-50 Eva Rosenberg, EA Thu, 24 Jun 2010 05:01:49 +0000 http://ec2-50-19-98-117.compute-1.amazonaws.com/tax/unromantic-money-and-tax-talk-before-marriage/#comment-50 Hi Bob,

Ouch. Did you know that there are penalties for over-contributing to retirement plans? If she is the "employer", the excise tax can be as much as 10% for over-contributing. http://www.irs.gov/retirement/article/0,,id=111419,00.html#24

I urge you to sit down with a tax professional to sort out each year's contributions and make corrections. Even though the difference may seem like $20 to you – to IRS the timing differences and over contributions can cause the entire plan to invalid – and all the contributions to be not only non-deductible, but subject to the penalties.

Two things I never mess around with when it comes to IRS are payroll tax contributions and retirement plan contributions.

Please, in the future, do not file your tax return until you have definite confirmation that a contribution has been made on time and applied to the correct year.

There's no reason to make contributions at the very last minute.

Best wishes,

Eva,
Your TaxMama

]]> By: Bob http://blog.equifax.com/tax/unromantic-money-and-tax-talk-before-marriage/#comment-49 Bob Fri, 28 May 2010 20:17:05 +0000 http://ec2-50-19-98-117.compute-1.amazonaws.com/tax/unromantic-money-and-tax-talk-before-marriage/#comment-49 Hi Eva I have a question
I filed my and my wife's joint tax form on time. I claimed 5,000 each for traditional IRA contributions. Then I found out that her contribution didn't make it on time for 2009. It was put in for 2010. Worried that I would lose money I researched her contributions for the past 4 years and realized that she over contributed 5000 in her sep IRA in 2007. When I factor the overpaying in 2007 in turbotax and take out the 2009 contribution it works out to a 20 dollar difference.
should I amend my 2009 tax to accurately reflect what year I contributed what?
Will that increase my chances of an audit?
Should I figure it evens itself out anyway and not bother amending since I could explain this if I do get audited

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