I made an excess (non-deductible) Traditional IRA contribution in 2020, discovered my error, and asked for the contribution to be returned shortly afterward. I received my 1099-R (from Vanguard) with Box 7 having a "2" entered. (early withdrawal, special case applies). The turbotax easy step interview says good news, no taxes are owed, yet the full amount of the withdrawal has been added to my income. It also doesn't ask anywhere to account for the slight interest gain between the amount of the original submission (5K) and the gain ($2).
Am I not answering something correctly?
