dmertz
Level 15

Get your taxes done using TurboTax

You'll request the Roth IRA custodian to make an explicit return of contribution of $460 and the custodian should calculate the adjusted amount to distribute just as you did ($460 - $34 = $426 based on your calculation).  There is no tax or penalty on this distribution since there are no taxable gains.

 

There is nothing to amend on your 2021 tax return with regard to this since there is no taxable gain included in the amount distributed as the return of contribution and you did not qualify for any Retirement Savings Contributions Credit that would otherwise need to be corrected.