dmertz
Level 15

Retirement tax questions

The ability to treat certain non-tuition fellowship and stipend payments as compensation for the purpose of am IRA contribution applies to contributions for 2020 and beyond, not to contributions for 2019.

 

If instead of obtaining a return of the excess contribution made for 2019 you choose to apply the excess as part of your 2020 IRA contribution, you'll still owe the 6% excess-contribution penalty for 2019.  You'll need to prepare and file Form 5329 and pay the penalty.  Although this form is sometimes accepted without being accompanied by Form 1040-X, you might want to include Form 1040-X to show that there are no other changes with respect to your 2019 filing.