Thanks yet again, @macuser_22.
Now I (think) I got it! What you are saying is that just add to the income in Line 1 now (pay the taxes) and then don't do anything else in the subsequent tax returns, including asking Fidelity to return the excess (as it is already past April 15th).
And whenever I chose to withdraw after retirement, I would be effectively paying taxes again on this amount as there will be no way to say that a certain portion was excess and taxes paid long ago. You just suck it up and pay it ... any gains (or losses) will be a factor in automatically as all the money is taxable anyway.
Hope my statements and interpretations above are correct. BTW, I read that paragraph again in Publication 525 page 10 and after reading your reply it makes more sense.
