Retirement tax questions

To clarify, you made an excess Roth IRA contribution in 2020 and then requested before the due date the withdrawal of the excess contribution for 2020 plus earning?

If yes, then you did no longer have an excess contribution and should not have paid the 6% penalty. If you paid the 6% penalty in 2020, 2021, or 2022, then you will have to amend the returns to remove the penalty.

 On the 2020 return, during the IRA contribution interview you will enter that you withdrew the excess contribution on the penalty screen:

1. Click on "Search" on the top right and type “IRA contributions”
2. Click on “Jump to IRA contributions"
3. Select “Roth IRA”
4. Continue until the penalty screen and enter the excess contribution amount withdrawn.

In the 2021, 2022 and 2023 returns you will delete excess contribution that got carried over:

1. Click on "Search" on the top right and type “IRA contributions”
2. Click on “Jump to IRA contributions"
3. Select “Roth IRA”
4. On the "Enter Excess Contributions" screen delete the excess contribution amount.

The 2021 Form 1099-R for the returned excess contribution plus earnings should have had code P and J in box 7 and therefore, should have been entered on your 2020 tax return.