- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Report Inappropriate Content
Retirement tax questions
Since the money was removed in 2021 you will not receive 1099-R's until Jan 2022. You should receive two 1099-R's one for the 2021 contribution that will have non penalty since it was removed before the 2020 due date of Apr 15, 2021. However, since it was a 2020 contribution the earnings are taxable in 2020 and must go on your 2020 tax return. The 1099-R should have a code "PJ" on box 7.
The 2019 contribution made in 2020 returned in 2021 will be a normal distribution that will have a code J in box 7. That distribution is reported on your 2021 tax return. Since it was NOT removed before the due date of then2019 tax return, you will need to amend 2019 and in the IRA contribution section add the Roth contribution and indicate that it was an excess contribution not removed by the 2019 due date which will produce a 2019 5329 form with a 6% penalty for the excess.