In 2017 I contributed say 5000 dollars to my Roth IRA, but figured out in Feb. 2018 that I cannot contribute that much due to income limit. So I removed the excess contribution, say 1000, in Feb. 2018 (before the April filing deadline) to correct it.
In addition to the requested 1000, my Roth IRA custodian calculated gain on the 1000 dollars and withdrawn gain as well. Let's say gain is 50 dollars.
My questions are:
1. How to report the 50 dollars in my tax return for 2017. It appears that IRS mentioned the 50 dollars should be reported in 1040 as income for tax year 2017, even though I received this 50 dollars in 2018. Is this correct?
2. When I try to tell TurboTax I received early distribution, it keeps asking me to fill in 1099R. But I contacted my IRA custodian and was told that I won't receive 1099R for the 50 dollars till 2019 (when I file my return for tax year 2018), because it happened in 2018. This seems to be contradictory to IRA's request, that if correction is made by April tax report due date, gain should be included in 1040, and form 5329 may be needed to pay early withdrawal penalty for the 50 dollars. So could you help clarify whether the 50 dollars and form 5329 should be reported when I file my return for year 2017, or should be included when I file my return for year 2018?
3. If the 50 dollar gain and form 5329 should be reported when I file my return for year 2017, how do I enter it in Turbotax without a 1099R?
