@wmct wrote:
Hello,
Thanks for your reply!
I called Fidelity retirement today, after 3 hours of holding. They insisted they had the right code on the form 1099R, which is J. And they stated that this is what they do all the time, sending a form 1099R with a code J and a form 5498. And having both of them side by side should have cleared things up for Tax preparers. They made it very clear that they wouldn’t change code from J to P. (Basically they said they didn’t misunderstand my situation, they just put a code J on 1099R for everyone else)
However, TurboTax software said we don’t need to enter form 5498 and there is no way to enter the form 5498.
I went back to TurboTax, realized that TurboTax does address situations like this by having us complete a Substitute Form 1099-R which is located on the same page where 1099-R form would be.
I hope will solve my problem. Again thank you very much for your reply!
If this was a 2020 excess returned in 2020 the a code PJ would be incorrect. That is for a 2019 contribution. A 2020 contribution returned in 2020 should have a code 8J. The earnings (if any) were required to be returned also and go in box 2a.
The substitute 1099-R will ask for an explanation and what you did to have the incorrect 1099-R corrected. Be sure to include that the financial institution was not cooperative and is ignoring the IRA 1099-R rules.
https://www.irs.gov/instructions/i1099r
[quote]
Roth IRA.
For a distribution from a Roth IRA, report the total distribution in box 1 and leave box 2a blank except in the case of an IRA revocation or account closure and a recharacterization, earlier. Use Code J, Q, or T as appropriate in box 7. Use Code 8 or P, if applicable, in box 7 with Code J. Do not combine Code Q or T with any other codes.
However, for the distribution of excess Roth IRA contributions, report the gross distribution in box 1 and only the earnings in box 2a. Enter Code J and Code 8 or P in box 7.
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
