It is better for us to request extension for 2023 tax filing so that we have more time to deal with the situation.
The removal of 2023 Roth contribution before the tax extension (oct 2024), therefore I think 2023's contribution will not have the 6% penalty, is that correct? Of course, we still need to pay the 2020-2022's excess contribution since the removal occurred in April 2024.
There are earnings from 2020-2023's contribution. We sold the stocks in April 2024 and now there are all in cash. I am not sure how the broker handles this. The excess Roth IRA removal form does not says whether it will just remove the original contribution amount or including the earning. If it need another request that removal all the earning at once in 2024, that might be more easy to calculate. It is just a net number that combines all the earning from 2020-2023 and pay 10% penalty, is that right? It is complicated.
