Should I owe the 6 percent excise tax for an excess IRA Contribution Penalty
Question: I am 64 years old and I am on social security. I have no other income for last year or this year. In January of this year, I made an IRA carry-back contribution ( for last year) contribution to my traditional IRA. When preparing my tax return this March , the results show that I will be penalized 6% excise tax on the contribution. Why is that? Answer: The 6% excise tax applies when