I'm a 25 year-old who has a Roth IRA with Fidelity.
In 2016 my grandmother gave me a gift of money that I used to contribute $5,500 to my Roth IRA. However, my earned income for 2016 ended up only being about $2,100.
I worked with Fidelity to have my excess contribution of $3,400 returned.
Fidelity officially calculated that my excess contributions had earnings of $1,413. I was told that I will have to pay a 10% penalty on these earnings.
I am trying to amend my tax returns before October 16, 2017 to avoid a 6% penalty on everything (principle & interest) until I fix it.
In TurboTax Deluxe online, when I go to amend my 2016 returns, I go to Federal Taxes > Deductions & Credits > Traditional and Roth IRA Contributions. I input my original contribution of $5,500 and was told I contribution too much. Then I input my $3,400 return of excess. It brought me to a summary page showing my corrected net contribution for 2016: $2,100.
Everything sounds great... except one problem: I was never asked about the earnings on my excess contribution.
If I'm supposed to pay a 10% penalty on my $1,413 of earnings, where and how to I do this? Please help! Time is running out :(
Thank you!
