"I contributed $6,500 to a Traditional IRA in September 2024 with after-tax funds and withdrew the exact same amount in December 2024. This qualifies as a 'return of contribution,'"
Not necessarily. If you took a regular distribution reported with code 1 in box 7 of the Form 1099-R, the distribution is not a return of contribution and is subject to the 10% early-distribution penalty. An actual return of contribution is a special type of distribution that must be explicitly requested and would be reported with code 8 in box 7.
