Get your taxes done using TurboTax

Please be aware, after 2020 there is no age limit on making regular contributions to traditional IRA (IRS). But you need to have taxable compensation to be able to make contributions.

If you have an excess contribution then to avoid the 6% tax on excess contributions, you must withdraw:

• the excess contributions from your IRA by the due date of your individual income tax return (including extensions); and
• any income earned on the excess contribution.

If you withdrew a 2021 excess contribution plus earnings in 2022 before the due date, then you will get a 2022 1099-R in 2023 with codes P and 1. This 1099-R will have to be included on your 2021 tax return and you have two options: 

• You can wait until you receive the 2022 1099-R in 2023 and amend your 2021 return or
• You can report it now in your 2021 return and ignore the 1099-R when it comes unless there is Box 4 Federal Tax withholding and/or Box 14 State withholding. Then you must enter the 2022 1099-R into the 2022 tax return since the withholding is reported in the year that the tax was withheld. The 2022 code P will not do anything in the 2022 tax return but the withholding will be applied to 2022.

To create a 1099-R in your 2021 return please follow the steps below:

1. Login to your TurboTax Account 
2. Click on the "Search" on the top right and type “1099-R”
3. Click on “Jump to 1099-R”
4. Answer "Yes" to "Did you get a 1099-R in 2021?"
5. Select "I'll type it in myself"
6. Box 1 enter total distribution (contribution plus earning)
7. Box 2 enter the earnings
8. Box 7 enter P and 1
9. Check the "IRA/ SEP/ SIMPLE" box
10. Click "Continue"
11. On the "Which year on Form 1099-R" screen say that this is a 2022 1099-R.
12. Continue until "Did you use your IRA to pay for any of these expenses?" screen and enter the amount under "Another reason" since you are over 59 1/2