By Sarah Brenner, JD
Director of Retirement Education
Fall is in full swing and October is almost upon us. That means that an important IRA deadline looms just ahead. Here are three transactions you must get done by October 15, 2026.
1. Make a SEP IRA contribution for 2025.
The deadline for making a 2025 traditional or Roth IRA contribution was April 15, 2026. That deadline has long passed. However, employers who are interested in establishing and funding a SEP IRA for 2025 may have a little more time to get this done. The deadline for making a SEP contribution is the business’s tax-filing deadline, including extensions. For some businesses that date is October 15, 2026.
2. Correct a 2025 excess IRA contribution without penalty.
Did you contribute too much to your traditional or Roth IRA for 2025? Maybe your income ended up being higher than you expected and it turned out you were ineligible for the Roth IRA contribution you made. If you made an excess contribution to your traditional or Roth IRA for 2025, you can fix that mistake by withdrawing the contribution, plus net income or loss attributable. Your deadline for getting this done and avoiding the 6% excess contribution penalty is October 15, 2026.
While recharacterization of Roth IRA conversions is long gone, recharacterization of tax year contributions remains an option to correct an excess contribution by moving it to a different type of IRA. The deadline for getting this done for 2025 contributions is also October 15, 2026.
3. Remove an unwanted 2025 IRA contribution.
It’s not too late. You can still change your mind about a 2025 IRA contribution. Have you changed your mind about the type of IRA to which you wanted to make your 2025 contribution? Maybe you contributed to a Roth IRA and now you think a traditional IRA is a better fit, or vice versa. October 15, 2026 is your last chance to recharacterize that contribution to the other type of IRA. If you later discovered that your 2025 traditional IRA contribution was not deductible and you wish you never made the contribution, October 15, 2026 is the deadline to correct this problem. Don’t miss the deadline. If you do, the contribution must remain in the IRA as a nondeductible IRA contribution.
If you have technical questions you would like to have answered, be sure to submit them to [email protected], to be answered on an upcoming Slott Report Mailbag, published every Thursday.
https://irahelp.com/three-ira-transactions-you-must-do-by-october-15/