@MinhT1 , @kate3116 , @dmertz
I have exact same question and unfortunately the answers do not resolve the situation for me.
Say, I contributed 5500 in 2018 to Roth IRA and now I am finding out that all of that was excess. lets say that 5500 yielded 200$ in 2018 and it also yielded 400$ in 2019.
The 2018 taxes were already filed while I am working on 2019 taxes.
I talked to Vanguard today and they said my excess withdrawal will remove only the 5500 and will generate the forms (1099 R) only in year 2021.
So, my question is:
1. Is it right that Vanguard will remove only 5500?
2. Do I need to amend 2018 tax return?
a. Do I need to pay taxes on the 200$ it earned in 2018? If so, if Vanguard doesn't provide that to me, who will?
b. If I don't have to pay taxes on the 200$, when what do I need to modify the 2018 returns for?
3. Finally, I make this excess removal now, I will pay the now 12% penalty (6% each year). But does that need to happen in my 2019 return or 2020 return. Remember Vanguard will give me the forms only in 2021 January.
