Total Excess contributions to Roth IRA for 2023 = $3500
Gross Distribution = $4071.06 ($3500 contributions and $571.06 earnings)
Taxable Amount = $513.95
The taxable amount reported on this Form 1099-R is incorrect. The taxable amount has to be $571.06 because the tax withholding is not permitted to be subtracted from the taxable amount. The payer needs to correct this Form 1099-R.
The penalty exception for the earnings distributed can be claimed on the $571.06.
