Excess Roth IRA Contribution - Removal and Reporting Help Needed

Forum|Forum|4 months ago
March 1, 2026
1 reply
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If I contributed an excess of $3,500 to my Roth IRA in 2024, but did not realize until March 2026, how do I report this on my 2024 and 2025 taxes? I assume the first step would be to have my custodian remove the excess contribution and associated gains, but from there what would the proper course of action be? My understanding is it would be as follows:

1. Amend my 2024 tax return, by reporting the excess $3,500 in contributions, then the TurboTax software will likely have me fill out form 5329 in order to pay the 6% excise tax; I also believe I will need to input the info I would likely see on my 1099-R form in order to have my amended 2024 tax return reflect the earnings related to the excess contribution removal, though I will need to calculate this (specifically the NIA) myself as I don't think I will I will receive the 1099-R until later in 2026/2027, but the info should just be the earnings, total amount returned, and inputting codes P and J (I also believe that assuming I input the form 1099-R info correctly, I can disregard the form once I receive it given I have reflected it in my amended 2024 taxes)

2. Once I have successfully and correctly amended my 2024 tax return, and it has been processed/accepted by the IRS, I can then file my 2025 taxes, which should i) also include a form 5329 in order to pay the 6% excise tax as I didn't remove the excess until after 12/31/25 and ii) should reflect the info from the processed/accepted amended 2024 taxes

3. Once I have successfully amended my 2024 tax return and file my 2025 tax return, I should be all good and will no longer have to pay the 6% excise tax given at 12/31/26 there will no longer be an excess present nor will I have to make any other retroactive corrections, and I should be good for the 2026 tax year

Any advice/corrections/clarifications/answers to the above would be much appreciated, that way I can correctly go about doing all this in TurboTax and not have any more issues going forward. Thank you!

Other

Best answer by DanaB27

You will request a regular distribution without earnings since you are past the due date of the 2024 return.

1. If you didn't pay the 6% penalty on your 2024 return then you will need to amend it to enter the Roth IRA contribution. Then TurboTax will automatically calculate the 6% penalty.

No, you do not need to add Form 1099-R with code PJ this is only if you remove the excess before the due date of the return.

2. You do not need to wait until the 2024 amened return is processed, you can file the 2025 return now. You will need to pay the 6% penalty on your 2025 return. Please see these steps:

Click on "Search" on the top right and type “IRA contributions”
Click on “Jump to IRA contributions"
Select “Roth IRA”
On the "Did you contribute more to a Roth IRA than was allowed in 2024 or any previous year?" answer "Yes"
On the "Enter your excess Roth IRA contributions made in 2024 or prior years" screen enter the total excess contribution from 2024 (if it wasn't carried over).

3. Yes, you will get a 2026 Form 1099-R with code J (assuming you are under 59 1/2) in 2027 and once you enter this into your 2026 return the excess contribution will be resolved. Please make sure that you included the excess contribution amount when TurboTax asks you in the 1099-R follow-up questions about the prior year Roth IRA contributions.

DanaB27Answer

Level 15

You will request a regular distribution without earnings since you are past the due date of the 2024 return.

1. If you didn't pay the 6% penalty on your 2024 return then you will need to amend it to enter the Roth IRA contribution. Then TurboTax will automatically calculate the 6% penalty.

No, you do not need to add Form 1099-R with code PJ this is only if you remove the excess before the due date of the return.

2. You do not need to wait until the 2024 amened return is processed, you can file the 2025 return now. You will need to pay the 6% penalty on your 2025 return. Please see these steps:

Click on "Search" on the top right and type “IRA contributions”
Click on “Jump to IRA contributions"
Select “Roth IRA”
On the "Did you contribute more to a Roth IRA than was allowed in 2024 or any previous year?" answer "Yes"
On the "Enter your excess Roth IRA contributions made in 2024 or prior years" screen enter the total excess contribution from 2024 (if it wasn't carried over).

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cl020202Author

Level 2

Thank you! Just a few more clarifying question(s):

1. I will need to amend my 2024 tax return - will the IRS bill me or is there an option for the amount to be taken out of my 2025 tax return/added to the 6% penalty on my 2025 tax return?

2. If I don't include the form 1099-R info I calculate on my amended 2024 tax return, but do include it on my 2026 return once I receive the actual 1099-R in 2027, is 2026 when I would be paying taxes on any of the earnings/NIA included on the excess contribution removal? I thought I would have to pay taxes on the related earnings somewhere in the process, and my assumption was I would be paying taxes through the 2024 tax return given those earnings are associated with the 2024 contributions/tax year

3. Will it just list code J on the 1099-R? I thought I read somewhere it would list P and J, but maybe that is related to the timing of the removal/distribution

Thank you for the quick response here, I really appreciate it!

cl020202Author

Level 2

And one other question - when my custodian removes the excess contribution, will they remove just the principal, or the principal and any gains/losses? I know for Fidelity they automatically calculate any NIA and remove both the principal and any G/L, whereas I believe eTrade has the customer calculate NIA depending on the timing of the removal and when the excess contribution(s) took place - further to that, I assume form 1099-R will reflect the correct principal and G/L removed (distributed) from my Roth?