Hi @DanaB27
I just spoke to the fidelity retirement team and discussed that they may have made a mistake and they verified the following twice with backoffice.
They said that because the contribution was made in 2024 (even though it was for the 2023 tax year), that as it was removed in Jan 2025 before the April 2025 tax deadline for 2024 tax year, it is a timely correction.
They said that in the 1099-R that we will receive in January 2026, it will have codes J and 8 (not J and P).
Knowing this, what should I put in turbotax?
I put $1607.19 in box 1
$276.30 in box 2
box 7 was code J and code 8.
I did not enter any other information in the other boxes.
Then in the section "did you use IRA to pay for any of these expenses", I entered $276.30 in Corrective distributions made before the due date of the return.
Is that correct as it says $0 tax due?
If I leave that blank it says $28 is due which is 10%.
What should we be entering there?
They said no penalty would be due, but we'd pay tax on the earnings. She only has around $3k in income for tax year 2024, is that why the earnings are not causing any extra tax?
Thanks for your advice
