How do I calculate earnings on my excess IRA contributions?

Usually, your IRA custodian will have all the information to calculate the earnings for you. You should work with them to figure out the amount to withdraw (your excess contributions plus any earnings). If the IRA custodian can't calculate the earnings, it's usually because you transferred your IRA from one financial institution to another. In that case, you'll need to calculate the earnings yourself.

To do this, you'll need the following information:

• Opening balance of the account right before the excess contribution was made.
• Contributions, transfers in, or conversions made from the opening balance date to the date before the withdrawal of the excess contribution is made.
• Withdrawals or transfers out of the account from the opening balance date to the date before the withdrawal of the excess contribution is made.
• Closing balance of the account right before the excess contribution and earnings were removed from the account.
• Excess contribution calculated by our software.

You can use Worksheet 1-4  in Publication 590-A to help you calculate the excess earnings. Once you have calculated the earnings, provide this information to your IRA custodian and work with them to make the withdrawal.