@SLYKTAX wrote:
I have the 2020 ROTH contribution return with gain. Since I won't be getting a 1099-R until January or February next year. I am now creating a substitute 1099-R for my 2020 tax return. I am 70, so what is the code for the box 7? I had a guy from Schwab said PJ. Doesn't look like it. P is Return of contribution taxable in 2019 - but mine is taxable 2020. And J is early distribution which I believe is for those under 59 1/2 and subject to 6% penalty. Please advise.
PJ is correct. The year advances by 1 every year so for a 2021 1099-R P means taxable in 2020. J is necessary because it is a Roth - without the J you would be reporting a 401(k) excess.
If you are over 59 1/2 then on the "Lets see if we can lower your tax bill" enter the box 2a amount in the "Another Reason" box to eliminate the 10% early withdrawal penalty on the earnings.
Enter the explanation for the excess contribution and that you are reporting a 2021 1099-R on your 2020 tax return to avoid having to amend in 2021.
Enter as a regular 1099-R not a substitute (you have not received an incorrect 1099-R to substitute for).
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
