I've read a lot of different posts about how to correctly resolve excess contributions. However, all of them either aren't exactly the same situation, or the question and/or answers don't give enough context to understand if it should apply to my situation or why.
I made excess contributions to my Roth IRA through 2021, but it didn't become clear until 2022 that I was over the MAGI limit to make any contributions at all.
In 2022, I contacted the administrator of my Roth IRA to have them do the calculation to remove the excess contributions plus earnings. That was completed, and I had a small number of earnings that I need to pay a penalty on (since I'm under 59 1/2).
Now I'm at the point where I think I've taken all the correct actions, but I'm struggling to know how to finagle TurboTax to have the correct info.
I have several different questions:
- I do not yet have a 1099-R for the return of excess contributions since I requested in 2022. The administrator of the account said it would be delivered to me as part of my 2022 tax documents. Based on this, do I just consider this as income for the 2022 tax year instead of 2021?
- Similarly, it's unclear to me if I'm required to file the form 5329 for the penalty in the year the excess contributions were made (2021) or in the year the securities were sold and the withdrawal was made (2022, where I'll also have the 1099-R to document it). TurboTax currently tells me that I "took no withdrawals from a retirement account before retirement age, even though I entered the withdrawal amount during the Roth IRA section after it identified I made an excess contribution.
Update (6/20) - Note that I made an estimated tax payment and filed an extension so that I could get this all sorted - but the withdrawal of excess contribution happened before the April 15th tax deadline.
