"April 15, 2023 - self (contributions for 2023 tax year made in 2023 + earnings tax withholding"
"I don't know what you mean by "earnings tax withholding".
Disregard withholding which is a separate issue.
If you took the contribution only, the earnings are still in there and have to be calculated and removed.
If the earning come out to be negative, then taking the entire contribution results in an early withdrawal."
What I meant was that contribution plus earnings were removed and in addition they custodian brokerage withdrew tax withholding on those earnings. When i questioned it, I was told this is how it is done if I want custodian to do the earning calculations. So, they took out more than they should have but It is done now.
"I 'm not familiar with how or whether the custodian can adjust for action you took on your own.
You can ask the custodian to calculate the earnings and inform you, then you take out whatever is still to be taken (i.e. earnings only as otherwise you will have taken too much, which is an early distribution, which has a penalty). penalty on early withdrawal, has its own rules, not discussed (yet)." I agree that they took out too much. However, regarding penalty, I am over 59 1/2, so I don't think I need to worry about early withdrawal penalty. Honestly, I have spent so much time so far with custodians to do it correctly, being passed from one manager to other, that I don't have it in me to keep trying after the fact. On top of that this issue about amendments and paying penalties is too taxing for me.
"earnings don't go on Schedule D; that are added into 1040 Line 4b. that is the only form involved."
You mean 1040X line 4b when I amend taxes?
Still not clear about what penalties (additional 6% etc.) are due with 2023 amendment.
@fanfare
