In our 2022 tax return, our Form 8606 contained an error: we reported non-deductible Traditional IRA contributions that were actually Roth IRA contributions. We worked with an independent tax preparer to amend that year's return. In the process, he found that my wife's Roth IRA contributions for that year ended up exceeding her limit by $724. Our amended return for 2022 corrects the Form 8606 error and includes a Form 5329 noting the excess Roth IRA contribution and an additional tax of $43 (which we have paid). Last November, we withdrew the $724 in excess contributions from my wife's Roth IRA at Vanguard; the money flowed into my wife's checking account. Vanguard sent us no Form 1099 for 2023, and when my wife logs into her Vanguard account, she sees a message saying she is owed no tax forms for 2023.
I have a few questions:
Does our withdrawal of the $724 in excess 2022 Roth IRA contributions need to be reflected anywhere in our 2023 return? If so, where and how?
Also: when we entered the $724 in excess 2022 Roth IRA contributions in TurboTax while preparing our 2023 return, the software reduced our federal refund estimate by $43—presumably because it assumes we still owe the additional tax on 2022's excess Roth IRA contributions. Is there a way we can indicate that we have already paid this additional tax? Thank you!
