Retirement tax questions
No, you do not have an excess contribution since you requested a return of excess contribution plus earnings. You don't have to enter the traditional IRA contribution, you can delete the entry with these steps:
- Login to your TurboTax Account
- Click on "Search" on the top right and type “IRA contributions”
- Click on “Jump to IRA contributions"
- Deselect the IRA and click "continue"
- Confirm that you want to delete the entry.
Yes, since you requested the withdrawal of an excess traditional IRA contribution made in 2024 for 2023 plus earnings in 2024 before the due date, you will get a 2024 Form 1099-R in 2025 with codes 8 and 1. This Form 1099-R will have to be included on your 2024 tax return. Only the earnings in box 2a will be taxable.
To confirm did you get the waring that you had an excess contribution and the screen showing a penalty or did you just get the warning that because of your modified adjusted gross income (MAGI) you cannot deduct the IRA contribution.
Screen for excess contribution:
Screen when you can make a traditional IRA contribution but you cannot deduct it because you have have a retirement plan at work and your MAGI is to high (TurboTax will fill out Form 8606):
If you got the second screen then you did not have an excess contribution. You just cannot deduct the contribution and will have a basis showing on Form 8606. See What is IRS Form 8606: Nondeductible IRAs for additional information.
