DaveF1006
Expert Alumni

Retirement tax questions

To remove the 10% penalty amount, you first ‌need to report in your return that you removed the excess contribution by April 15. You will then prepare a 1099R entry to report the removal of the excess contribution. Here is how to report the 1099R.

 

  1. Box 1 enter total distribution (contribution plus earnings.
  2. Box 2a enter the earnings
  3. Box 7 enter J and P These will be two separate entries
  4. Click "Continue"
  5. On "Is the IRA/SEP/SIMPLE box on this 1099-R checked?" screen answer "No, the box is blank"?
  6. On the "Which year on Form 1099-R" screen say that this is a 2025 Form 1099-R.
  7. Click "Continue" after all 1099-R are entered and answer all the questions.
  8. Continue until "Did you use your IRA to pay for any of these expenses?" screen and enter the amount of earnings under "Corrective distributions made before the due date of the return".

As far as the 1099R with extra tax, this may have happened for two reasons. 

 

  • The extra income may have placed you in a higher tax bracket
  • There may have not been enough tax withheld.

Check your entry just to make sure your tax is withheld  and reported in Box 4 in your TurboTax program.

 

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