Is it legal to redeposit funds from my Roth IRA I had withheld for tax

[Guest irr7342]

I mistakenly had taxes withheld from my conversion from my IRA to my Roth IRA. Schwab is telling me I can't redeposit those funds even though it's within 60 days. Is anyone aware of a law that says I can't redeposit the amount I withheld for taxes thereby avoiding a penalty. I know I can't get my original tax withholding back but why couldn't I redeposit the same amount and have my original tax withholding just represent a tax credit. Please help. Schwab is telling me I can't do this but if the conversion tax withholding is a penalty distribution then I have 60 days. Correct?

[BPickerCPA]

Schwab doesn't know what the heck they're talking about. Go up the chain and talk to higher people. Tell them that if they refuse the deposit you will hold them responsible for the consequences.

You have every right to correct the error of withholding be replacing the funds within 60 days with outside money.

Shheeesh!

[John G]

You will find that the counter folks of Schwab or any large brokerage often are limited in their knowledge of these kind of details. Between the modest pay and turnover of staff, all firms struggle to deploy knowledgeable staff. You will find that the Schwab IRA specialty area in San Francisco is very aware of the rules, just ask to be connected to them.

I would recommend to anyone dealing with technical issues to bypass the counter and talk to the tech specialists... at Schwab or any brokerage.

[Guest irr7342]

A big thanks for the confirmation.