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needtaxhelp1232
New Member

Excess Roth IRA withdraw after taxes but before October 15th

I made an excess contribution to my Roth IRA in 2021 due to my income being too high. I tried to withdraw it before April 18th, but due to a miscommunication with the company, it was not withdrawn. I noticed that it was still there and removed it before October 15th. It was my understanding that I didn't have to pay the 6% fee if I withdrew before October 15th, but turbo tax is telling me I do. How do I amend my taxes using Turbo Tax in this situation?

2 Replies
Mike9241
Level 15

Excess Roth IRA withdraw after taxes but before October 15th

If you timely filed your return without withdrawing the excess contributions, you can still make the withdrawal no later than 6 months after the due date of your tax return, excluding extensions. If you do, file an amended return with “Filed pursuant to section 301.9100-2” entered at the top. Report any related earnings for 2021 on the amended return and include an explanation of the withdrawal. Make any other necessary changes on the amended return (for example, if you reported the contributions as excess contributions on your original return, include an amended Form 5329 reflecting that the withdrawn contributions are no longer treated as having been contributed).

 

tell Turbotax you withdrew it by 4/18/2022

make sure to include any earnings. 

you will need to paper file - see bold above. 

since apparently there was no 5329 with the original. there won't be one for the amended. just include a full explanation. 

Opus 17
Level 15

Excess Roth IRA withdraw after taxes but before October 15th

tell Turbotax you withdrew it by 4/18/2022

 

Yes

 

make sure to include any earnings. 

 

I think you have to make a "substitute 1099-R" to report the earnings from the withdrawal, if there are any earnings.  The earnings will be subject to regular income tax plus a 10% penalty for early withdrawal unless you are over age 59-1/2 and the Roth IRA was open at least 5 years.  Someone else may have more exact advise on how to report the earnings @macuser_22 @VolvoGirl 

 

you will need to paper file - see bold above. 

 

agreed

 

since apparently there was no 5329 with the original. there won't be one for the amended. just include a full explanation. 

 

If you originally filed by telling Turbotax that you would remove the excess, then there was no 5329 generated therefore nothing to remove.  And since you already told turbotax you planned to remove the excess by April 15, that by itself won't trigger an amendment (Turbotax will tell you there is nothing to change.)  The change that will allow Turbotax to recognize an amended return is needed is the addition of the taxable earnings.

 

If there are no taxable earnings because the Roth IRA lost money, then I don't know how you can file.  What you technically need to do is to send the exact same tax return again, plus a form 1040-X with no changes, with the bold statement at top, and a written explanation.  But turbotax won't generate a 1040-X if there are no changes. You may need to print one out and fill it in by hand.  

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*
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