In 2018 my wife and I contributed $6500 each to our individual ROTH IRA's. However, in doing my taxes in March of 2019 i recognized that due to my lack of earned income we couldn't make the contributions. I quickly called my broker and asked that they reverse the contribution and place the excess money in my regular securities account. They advised me that I could do this,but that we would be taxed for any interest we gained. They provided me the amount of interest gained and I filed a Form 4852 with my taxes. Form 4852 provides a substitute to Form 1099R if the financial institution can't provide an official 1099R in time for filing. With the calculated interest on the gain and explanations for the excess contributions I was content that I was now square with the IRS. My frustration is that in 2019, I have received 1099-Rs from our financial institution, essentially duplicating what I have already reconciled with the IRS in my 2018 tax filings. I already paid the tax on the excess contribution gains and now am asked to pay them again. The IRS has all this information with my filings, but how do I explain through Turbo-Tax that it's already done??! If I follow the Turbo instructions and list the two 1099R's I am informed that i need to file and amended 2018 return. HELP with my catch-22...
The first mistake you made was reporting the excess interest on the 4852. You should never had done that. In your case, you would received the 1099R for in 2019 for that transaction. Here is my advice, which I think offers the best solution.
Thanks Dave. Wise advice- But, when I input the 2019 1099-R's for my wife and I, on Turbotax, i follow the directions, only to be advised at the end that we need to file a 2018 amend.
I agree. i think this verifies with what i mentioned.
Why does Turbo need to know the total value of my Traditional IRA'S!?
This information would be needed if Form 8606 needs to be generated.