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I will appreciate any help or suggestion on my Roth IRA mess up.

I have a Roth IRA with Sharebuilder. Early this year, I over-contributed about $400 for year 03. This amount was later recoded as for year 04 right before 4/15. But now it turned out that I can not contribute any amount at all for this year because my income reached over the limit. I tried to remove this excess amount but Sharebuider insisted that I have to pay 10% Federal tax + state tax because of early distribution. Is that right?

Also I am considering moving the IRA to Scottrade. I learned that I have to pay $50 to transfer the entire account out of Sharebuilder. Does anyone know if there is any way to avoid this fee?

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