Hi,
In February of 2022, I realized I had made an excess contribution to my Roth IRA in 2021. I reached out to my brokerage firm, Fidelity Investments, and asked them to correct the excess contribution. They did, and returned to me the excess contribution amount, along with the applicable earnings.
These applicable earnings needed to be reported as income for the year 2021, and I did not do this, hence the need for the amended return. I am under 59 1/2 years old, so I am obligated to pay a 10% penalty on those earnings, in addition to the income tax.
I did not receive a 1099-R, because the correction occurred in 2022 (for the year 2021), so Fidelity insists I am to receive the record of the transaction in January 2023. I believe that I am therefore required to fill out a substitute 1099-R, as well as form 5329 for Additional Taxes on Qualified Plans.
This is where I run into problems. When I fill out the substitute 1099-R, I enter the gross distribution and taxable amount (which is the same), and the distribution code J for early Roth IRA distributions. At this point, TurboTax calculates my tax obligation as $0. While I'd love this to be the case, I don't see how that's possible since I'm amending my return with additional taxable income! When I try to go to Forms -> Open Form -> Form 5329, I find that the fields in the "Early Distributions Included in Gross Income Smart Worksheet" box are uneditable (particularly box F "ROTH IRA distributions").
I just want to get this right, and TurboTax is making this very difficult. What do I do to correctly enter this information?
