1) The 1099-R with codes 8 and 1 indicates that you removed an 2020 excess contribution in 2020. You might want to double check with your bank if they removed the 2019 excess contribution correctly. You should have gotten a 1099-R with the codes P and 1 since you wanted to remove the 2019 excess contribution and it happened in 2020.
2) If your bank states this is the correct 1099-R with coded 8 and 1 then you will have to include it on your 2020 tax return. You will enter it by following these steps:
- Login to your TurboTax Account
- Click on the Search box on the top and type “1099-R”
- Click on “Jump to 1099-R”
3) No, you should not have a 6% penalty for excess contribution unless you made 2020 IRA contribution over the limit.
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