KrisD15
Expert Alumni

Get your taxes done using TurboTax

That is a gray area. 

If you feel you need to file because you contributed to a Roth with no income, you may withdraw that amount as well as the interest to avoid the penalty. Depending on the amount, you may need to report the interest.

 

If you file a return, you are required to report all income. 

For you, the 1098-T generates income, so yes, report it. 

 

If you don't include it, there would be NO impact to your tax liability. 

If you don't include it and you were to be audited, you would not owe any tax for not including it. 

 

To be compliant, enter the 1098-T into your TurboTax program. It should not generate additional tax, but you may owe the penalty on the Roth Contribution if you don't withdraw it in time. 

 

According to the IRS:

“You won’t have to pay the 6% tax if you withdraw an excess contribution made during a tax year and you also withdraw any interest or other income earned on the excess contribution. You must complete your withdrawal by the date your tax return for that year is due, including extensions.”

 

IRS Pub 590-A

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"