Contributions Returned Before Due Date of Return: IRA Contributions and Transfers (2025 IRS Guide)
This guide covers “Contributions Returned Before Due Date of Return” within ira contributions and transfers. The following material presents the IRS treatment of this topic, including the qualifications, exceptions, and examples in the source section. Read the rules alongside the facts of your own situation before deciding what to report, deduct, or document.
Adapted from Publication 590-A (2025), Contributions to Individual Retirement Arrangements (IRAs), published by the Internal Revenue Service. This guide retains the source edition’s years, amounts, deadlines, and examples. It is guidance for that edition, not a statement that the same figures apply to every tax year.
Context for these rules
You can withdraw or use your traditional IRA assets at any time. However, a 10% additional tax generally applies if you withdraw or use IRA assets before you reach age 59½. This is explained under Age 59½ Rule under Early Distributions in Pub. 590-B.
You can generally make a tax-free withdrawal of contributions if you do it before the due date for filing your tax return for the year in which you made them. This means that, even if you are under age 59½, the 10% additional tax may not apply. These withdrawals are explained later.
Contributions Returned Before Due Date of Return
If you made IRA contributions in 2025, you can withdraw them tax free by the due date of your return. If you have an extension of time to file your return, you can withdraw them tax free by the extended due date. You can do this if, for each contribution you withdraw, both of the following conditions apply.
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You didn’t take a deduction for the contribution.
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You withdraw any interest or other income earned on the contribution. You can take into account any loss on the contribution while it was in the IRA when calculating the amount that must be withdrawn. If there was a loss, the net income earned on the contribution may be a negative amount.
Note:
If you timely filed your 2025 tax return without withdrawing a contribution that you made in 2025, you can still have the contribution returned to you within 6 months of the due date of your 2025 tax return, excluding extensions. If you do, file an amended return with “Filed pursuant to section 301.9100-2” written at the top. Report any related earnings on the amended return and include an explanation of the withdrawal. Make any other necessary changes on the amended return (for example, if you reported the contributions as excess contributions on your original return, include an amended Form 5329 reflecting that the withdrawn contributions are no longer treated as having been contributed).
In most cases, the net income you must withdraw is determined by the IRA trustee or custodian. If you need to determine the applicable net income on IRA contributions made after 2025 that are returned to you, use Worksheet 1-4. See Regulations section 1.408-11 for more information.
Worksheet 1-4. Determining the Amount of Net Income Due to an IRA Contribution and Total Amount To Be Withdrawn From the IRA
| 1. | Enter the amount of your IRA contribution for 2026 to be returned to you | 1. | _____ |
| 2. | Enter the fair market value of the IRA immediately prior to the removal of the contribution, plus the amount of any distributions, transfers, and recharacterizations made while the contribution was in the IRA | 2. | _____ |
| 3. | Enter the fair market value of the IRA immediately before the contribution was made, plus the amount of such contribution and any other contributions, transfers, and recharacterizations made while the contribution was in the IRA | 3. | _____ |
| 4. | Subtract line 3 from line 2 | 4. | _____ |
| 5. | Divide line 4 by line 3. Enter the result as a decimal (rounded to at least three places) | 5. | _____ |
| 6. | Multiply line 1 by line 5. This is the net income attributable to the contribution to be returned | 6. | _____ |
| 7. | Add lines 1 and 6. This is the amount of the IRA contribution plus the net income attributable to it to be returned to you | 7. | _____ |
Example.
On May 2, 2026, when your IRA is worth $4,800, you make a $1,600 regular contribution to your IRA. You request that $400 of the May 2, 2026, contribution be returned to you. On February 2, 2027, when the IRA is worth $7,600, the IRA trustee distributes to you the $400 plus net income attributable to the contribution. No other contributions have been made to the IRA for 2026 and no distributions have been made.
The adjusted opening balance is $6,400 ($4,800 + $1,600) and the adjusted closing balance is $7,600. The net income due to the May 2, 2026, contribution is $75 ($400 x ($7,600 – $6,400) ÷ $6,400). Therefore, the total to be distributed on February 2, 2027, is $475. This is shown on Worksheet 1-4. Example—Illustrated.
Worksheet 1-4. Example—Illustrated
| 1. | Enter the amount of your IRA contribution for 2026 to be returned to you | 1. | 400 |
| 2. | Enter the fair market value of the IRA immediately prior to the removal of the contribution, plus the amount of any distributions, transfers, and recharacterizations made while the contribution was in the IRA | 2. | 7,600 |
| 3. | Enter the fair market value of the IRA immediately before the contribution was made, plus the amount of such contribution and any other contributions, transfers, and recharacterizations made while the contribution was in the IRA | 3. | 6,400 |
| 4. | Subtract line 3 from line 2 | 4. | 1,200 |
| 5. | Divide line 4 by line 3. Enter the result as a decimal (rounded to at least three places) | 5. | 0.1875 |
| 6. | Multiply line 1 by line 5. This is the net income attributable to the contribution to be returned | 6. | 75 |
| 7. | Add lines 1 and 6. This is the amount of the IRA contribution plus the net income attributable to it to be returned to you | 7. | 475 |
Last-in first-out rule.
If you made more than one regular contribution for the year, your last contribution is considered to be the one that is returned to you first.
Earnings Includible in Income
You must include in income any earnings on the contributions you withdraw. Include the earnings in income for the year in which you made the contributions, not the year in which you withdraw them.
.Generally, except for any part of a withdrawal that is a return of nondeductible contributions (basis), any withdrawal of your contributions after the due date (or extended due date) of your return will be treated as a taxable distribution. Excess contributions can also be recovered tax free as discussed under What Acts Result in Penalties or Additional Taxes, later..
Early Distributions Tax
The 10% additional tax on distributions made before you reach age 59½ doesn’t apply to these tax-free withdrawals of your contributions. However, the distribution of interest or other income must be reported on Form 5329 and, unless the distribution qualifies for an exception to the age 59½ rule, it will be subject to this tax. See Early Distributions under What Acts Result in Penalties or Additional Taxes? in Pub. 590-B.
Excess Contributions Tax
If any part of these contributions is an excess contribution for 2024, it is subject to a 6% excise tax. You won’t have to pay the 6% tax if any 2024 excess contribution was withdrawn by April 15, 2025 (including extensions), and if any 2025 excess contribution is withdrawn by April 15, 2026 (including extensions). See Excess Contributions under What Acts Result in Penalties or Additional Taxes, later.
.You may be able to treat a contribution made to one type of IRA as having been made to a different type of IRA. This is called recharacterizing the contribution. See Recharacterizations, earlier, for more information. .
Using the guidance
Keep the documents that establish the dates, amounts, and circumstances described above. References to other chapters, forms, worksheets, or earlier and later sections refer to the linked IRS publication. Check the full publication and its updates before relying on a rule for a different tax year or a situation not addressed here.
Sources and further reading
- Publication 590-A (2025), Contributions to Individual Retirement Arrangements (IRAs): Traditional IRAs — When Can You Withdraw or Use Assets? — Contributions Returned Before Due Date of Return — Internal Revenue Service; 2025 edition.
The cited U.S. government text is in the public domain. Source accessed October 28, 2026. Fynoptic has organized this material for educational use and is independent of, and not endorsed by, the IRS.