I have a few additional questions. As previously mentioned I filed the 2018, 2019, and 2020 5329 forms each year with each return and paid the 6% penalty each year, so
As I understand things:
I take distribution on the remaining excess of $1660 before the end of 2021 (no earnings), financial firm should issue a 1099R with code J in box 7 and I will need to fill out a 5329 with my 2021 return which will zero out any further 6% penalties. No other taxes or penalties due.
My financial firm stated the following which I don’t quite understand since this is a Roth not a Traditional IRA:
1. The excess contribution being withdrawn cannot be deducted or reported as a contribution for the year made. This may necessitate amending a tax return.
2. If the total contribution made to an IRA for the year is more than the maximum contribution limit in effect for the year the excess amount is generally includible in gross income.
Are there any other actions I need to take with regard to prior tax returns? As mentioned before I have already filed 5329’s and paid 6% each year.
Thanks
