The code in box 7 of the Form 1099-R will be code P to indicate that the earnings are taxable on the tax return for the year prior to the year of the form or will have code 8 to indicate that the earnings are taxable on the tax return of the same year as the the year of the form. Because the wording of the statute was written before the tax code was changed to allow IRA contributions made by the due date of the tax return to be for the prior year, it's not clear which way a particular IRA custodian will code the return of a contribution that had been made for the prior year. In the case of a 2024 Form 1099-R, if the custodian codes the form with code P, in means that the earnings are taxable on the 2023 tax return. If the IRA custodian instead codes the 2024 Form 1099-R with code 8, the earnings will be taxable on the 2024 tax return.
