I've searched endlessly for a clear, concise answer. I also called my financial firm, and the IRS (twice). I'm still unclear on the total penalty, and on my next steps to file appropriate paperwork. Here's my pickle:
In early April, 2025, I contributed $8K to a Roth for tax year 2024. A few days ago, while working on my 2025 taxes, I realized that I wasn't eligible to make that contribution (no earned income). I contacted Fidelity, yesterday, and they removed the excess contribution and earnings. One rep said I don't owe a penalty, another said I owe owe a 6% penalty, and the IRS said I owe two 6% penalties. I'm royally confused. Also, I don't know which forms to file to fix this mess. I know the 5398 is going be involved, but I don't know if I should amend my 2024 taxes first with a new 5398 (2024), before filing my 2025 taxes.
I would think this situation is somewhat commonplace, so I'm shocked at how difficult it appears to fix. Thank you for any help. I've been trying to get answers for 2 days now.
