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Refund Inquiries

Question: May I direct part or all of my refund to apply as a contribution for the prior year to my individual retirement account (IRA) on Form 8888?

Answer:

Yes, but the refund must be deposited by the due date for filing your tax return.  In addition, IRS direct deposits of federal tax refunds will not indicate a contribution year for IRA accounts.

  • You should ensure your financial institution accepts deposits for the prior year to IRA accounts.
  • As with all IRA deposits, the account owner is responsible for informing their IRA trustee of the year for which the deposit is intended, for ensuring their contributions do not exceed their annual contribution limitations, and for ensuring their contributions are timely made.

If you fail to notify your IRA trustee of the intended year for the deposit, your trustee can assume the deposit is for the current year (e.g. a refund received in 2014 is for 2014 not 2013).

The IRS is not responsible for the timeliness or contribution amounts related to an IRA direct deposit.

  • An error on your return or an offset of your refund could change the amount of refund available for deposit (for more information, see FAQ Are there conditions that could change the amount of my direct deposits?).
  • You must verify the deposit amount and that the deposit was actually made to the account on time—i.e., by the due date of the return (without regard to extensions).

If the deposit is not made into your account by the due date of the return (without regard to extensions), the deposit is a contribution for 2014, rather than 2013, and you must file an amended 2013 return and reduce any IRA deduction and any retirement savings contributions credit you claimed.


Category: IRS Procedures
Subcategory: Refund Inquiries

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The OMB number for this study is 1545-1432.
If you have any comments regarding this study, please write to:
IRS, Tax Products Coordinating Committee
SE:W:CAR:MP:T:T:SP
1111 Constitution Avenue NW
Washington, DC 20224