DanaB27
Expert Alumni

Get your taxes done using TurboTax

When removing an excess contribution after the extended due date you will only have to remove the the excess contribution without the earnings or losses. So you still need to remove the $11,500 excess contribution from 2012 (assuming you were allowed to make the $5,000 contribution for 2012).

 

You will have to pay the 6% penalty on the $11,500 excess contribution each year this was in the account so from 2012 to 2024 (assuming you weren't able to apply the excess in the following years). You use Form 5329 for each year to calculate it. Please see Prior Years Form 5329 to search for each year.

 

If you haven't paid the 6% penalty for the 2018, 2020, and 2021 excess then you will still have to pay the penalty for those too.

 

Assuming you weren't allowed to apply the excess as a Roth IRA contribution to any of the following years:

 

For 2012 to 2017 you pay $690 each year on the $11,500 excess (if your balance was smaller that $11,500 at the end of the year then you will only pay 6% x the balance on December 31, 20XX).

 

For 2018 you will have $18,000 excess contribution and need to pay $1,080 (if your balance was smaller that $18,000 at the end of 2018 then you will only pay 6% x the balance on December 31, 2018).

 

For 2019 you pay $1,080 on the $18,000 excess.

 

For 2020, you pay $1,500 on the $25,000 excess.

 

For 2021 to 2023 you pay $1,920 each year on the $32,000 excess.

 

For 2024 you pay $690 on the $11,500 excess. 

 

If you remove the rest of the excess by the end of 2025 then you do no longer pay the 6% penalty.

 

 

Please see How do I amend my federal tax return for a prior year?

 

 

On your 2024 return you will enter the Form 1099-R with code J for the distribution of the 2018, 2020, and 2021 excess:

 

  1. Login to your TurboTax Account 
  2. Click on "Search" on the top and type “1099-R” 
  3. Click on “Jump to 1099-R” and enter all your 1099-Rs
  4. Click "Continue" on the "Review your 1099-R info" screen
  5. Answer all the questions and make sure you enter the net contributions prior to 2024 on the "Enter Prior Year Roth IRA Contributions" screen (include your excess contributions here)
  6. On the "Do you have any Excess Roth Contributions" answer "Yes"
  7. On the "Enter Excess Contributions" screen enter the total excess contribution ($32,000).
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"