Question:   Can I direct part or all of my refund to my prior year individual retirement account (IRA)?

Answer:   IRS direct deposits of federal tax refunds will not indicate a contribution year for IRA accounts.

• You should ensure your financial institution accepts deposits to prior year 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 and for ensuring their contributions do not exceed their annual contribution limitations.

If you fail to notify your IRA trustee of the intended year for the deposit, your trustee can assume the deposit is for 2008.

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 Are there conditions that could change the amount of my direct deposits?).
• You must verify the deposit was actually made to the account by the due date of the return (without regard to extensions) and the deposit amount.

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 2008, rather than 2007.

• You must file an amended 2006 return and reduce any IRA deduction and any retirement savings contributions credit you claimed.