Retirement tax questions

return of excess contribution:

before tax due date including extensions: positive earnings allocable to the excess are taxable on the Line 4b for the year of the contribution. negative earnings are ignored; therefore, do report the entire requested amount as returned .

 

positive earnings removed are penalized 10% if you are under age 59 1/2.  That's the only situation that would require Form 5329.

 

Since you had negative earnings. the amount going to 1040 Line 4b is zero.

 

@Smorr017 

@gvrp