Because the 2019 excess plus any was not withdrawn before the due date of the 2019 tax return you will owe a 6% penalty on that excess for 2019. Having it applied to a later year is the same as removing it but does not eliminate the 6% penalty.
Since $900 of the excess still remains in the account, you must distribute that before the end of 2020 to avoid another 6% penalty for 2020. There will be no 2020 tax on that distribution since it is your own contribution.
Paying the 6% penalty negates having to remove any earnings.
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
