I don't think he's confused at all. I just think he doesn't know what to do.
I have the exact same situation and don't know what to do either. Please try to explain 😉
My (ex) custodian sent 2 1099R forms for 2024, one coded P and one coded X. They put in Trad IRA contributions (from my taxable assets) for 2023 ( 7500) and 2024 (8000) in Feb. 2024. I wasn't eligible for either, thus 2 excess contributions. They were removed from the IRAs and the forms say nothing is taxable.
Questions:
1- They were in there for a few wks. I imagine they both incurred some interest, though I dont know. Wouldn't that be taxable income? If they didnt include can I assume there was none and that maybe it even lost money?
2-I have no taxable income to report, as of now and my taxes are due soon. Custodian didnt report any. if there was any though, like his, the 2024 would go on which form? And pertinent to what he is asking, where would the interest from the 2023 go? it was earned in 2024 so it seems it must go on the 2024 return. So why would the 2023 need to be amended? There was no extra income earned. And the IRA never happened so no tax consequences on the principal.
So I dont understand ( and I dont think he does either) why the 2023 needs to be amended ? I understand our cases are slightly different. it would help to speak in language as simple as possible because so much stress accompanies this. I want to avoid an extension if possible. and when you say 'no penalties if you explain what happened" to IRS- you mean indicate it was a simple mistake? Seems if you were doing it intentionally you would never report you had excess/ disallowed contributions.
