@macuser_22, yes I was suggesting that as a possibility if the distribution was made before the due date of the 2017 tax return, but I don't know how the IRS would react to it. The law does not specify how a return of contribution must be reported by the payer, only that a distribution that is a return of contribution must be accompanied by attributable gains (or loss), so treating a regular distribution made by the due date of the tax return as a partial return of excess contribution seems reasonable to me.
However, I didn't address the issue that the distribution actually occurred on 4/18/2018. 4/18/2018 is one day beyond the statutory due date of 4/17/2018, but on 4/17/2018 the IRS had processing problems that caused them to treat tax returns filed on 4/18/2018 to be timely filed. There was debate last year about whether or not this also extended the deadline for making IRA contributions or a corrective distribution before the due date of the 2018 tax return. My position on this was that the IRS granted an automatic 1-day extension but did not actually change the due date (since IRS processing problems had no bearing on the ability of an IRA distribution to be processed), so with that interpretation it appears that the distribution on 4/18/2018 was actually made after the due date of the 2017 tax return, that the 6%, $390 penalty is due for 2017 (on 2017 Form 5329), and the $6,500 regular distribution resolves the excess on the 2018 Form 5329, but is nontaxable. In 2018 TurboTax it's necessary to enter $0 in box 2a to trigger TurboTax to treat it as a nontaxable return of contribution after the due date of the tax return and prompt for explanation.
If one takes the position that the distribution can be treated as a return of contribution before the due date of the 2017 tax return, given that a 2018 code P Form 1099-R is reportable on the 2017 tax return I imagine that one would amend the 2017 tax return with an explanation statement indicating the partial return of the excess contribution that I described but include the substitute Form 1099-R (2018 Form 4852) with the 2018 tax return to explain why the code 7 Form 1099-R is not being included in income on the 2018 tax return.
