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@Strongsilence-CPA wrote:

it might be worth it to wait for a market downturn. 

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No, no and no.

Besides the fact that the market could also increase and that you should NOT be advising your client when to sell investments, if you expect it to downturn it would be crazy to wait for that.  It is a bit more complex than this, but here is a simplified example:

Let's say the excess IRA value is $10,000.  A 6% penalty would be $600.  Therefore your net value is $9,400.

If you expect the market to decrease, let's say the excess value would then be $9,500.  Then the 6% penalty would be $570, and your net value would be $8930.

You would not want to intentionally wait/hope for a market decrease, as your net value in this example would be $470 less than if you sold it right away.