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Retirement tax questions
Yes, that is correct, you would go back to Turbo Tax 2022 and amend 2022 return with 6% penalty on the $7500; for 2023 return, you would file now with 6% penalty by entering the excess contribution for prior years in the IRA contribution section. You don't enter the 2024 Form 1099-R on your 2023 return, you will enter it on your 2024 return.
You requested the withdrawal in 2024, which was after the due date of the 2022 return, therefore, you need to only remove the excess contribution amount as a regular distribution (ignore earnings or losses). If you removed less because of the loss but emptied the account then then the excess contribution will be resolved in 2024 when you enter the 2024 Form 1099-R on your 2024 return. The 6% penalty for 2024 is calculated as the smaller of the excess contribution or the value of your Roth IRAs on December 31, 2024 (including 2024 contributions made in 2025). Therefore, if your Roth account is empty then the excess contribution will resolve in 2024.
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