Yes, only the earnings on a returned excess contribution (for 2021) are taxable on your 2021 tax return. If you have a loss then you have no income to report. Entering the 2023 Form 1099-R with codes JP (with a loss) on your 2021 tax return would only trigger the Explanation Statement for the returned contribution. Therefore, you don't need to amend your 2021 return but please make sure you keep all documentation.
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