April 12, 2019: I incorrectly made an excess contribution for tax year 2018 to a traditional IRA of $6,500.
Two hours later I submitted the form to have the excess amount transferred out of the account. The transaction would complete after April 15, 2019.
April 15, 2019: I submitted a Federal extension and made an estimated tax payment that assumed that no 2018 IRA contribution was made.
April 18, 2019: The excess $6,500 + $0.04 earnings was confirmed to be transferred out of the traditional IRA account.
Should I change my 2018 tax return to indicate that I made a $6,500.00 IRA contribution for 2018 before filing it?
If the excess was removed, then there is nothing to report in 2018. Don't enter the contribution at all.
In 2020 you will receive a 2019 1099-R for the return of contribution, but it will not be taxable since the earnings are less then 50 cents so they round to zero.
@Ventura wrote:
how much will be in box 1? what code will be in box7?
That depends on your circumstances and what you did.
I like to know the 1099-R receive next year, is for which year? what's the amount in box 1? which code in box7?
@Ventura wrote:
I like to know the 1099-R receive next year, is for which year? what's the amount in box 1? which code in box7?
If the excess was returned in 2020 the you will get a 2020 1099-R.
If you asked for a return of excess and not a normal distribution then the amount of excess plus any earnings attributed to the excess will be in box 1 and any earnings in box 2a.
The box 7 code depends if it was a Roth or Traditional IRA and if it was a 2019 excess returned in 2020 or a 2020 excess returned in 2020 - they are all different.