Excess Roth IRA contribution 2023

[txpharmguy0330]

We had an excessive Roth IRA contribution for 2023.  We didn't discover this until filing taxes.  Our investment firm removed the excess before filling date.  The excess contributions were $15,000 (7500 each, MFJ).  The earnings were roughly $2300 and change.  I owe tax on this but am unsure of the best way to handle this without paying a penalty. I won't receive a 1099-R until Jan/Feb of 2025.  I have letters from the brokerage firm, EJ, indicating the excess contributions and earnings on said accounts.  Can I file an amended return for 2023 using a substitute 1099-R (IOW, I'd just enter contributions on line 1 and earnings in 2b), let TT figure out the additional tax owed (roughly $600) and just make a direct payment to IRS or should I wait until I receive the 1099-R and file with my 2024 return?  Any insight would be greatly appreciated

[fanfare]

"let TT figure out the additional tax owedet TT figure out the additional tax owed (roughly $600) and just make a direct payment to IRSand just make a direct payment to IRS"

That's exactly what you will be doing whether you do it now or later.

If you do it now, you can take advantage of e-File of 1040-X which lasts until Oct 15th.

"(roughly $600)"

not good enough, you must enter the exact amount of positive earnings.

You can get that by subtracting  your contribution from the amount the custodian returned to you.

If you get the correct result on Form 1040, it doesn't really matter what 1099-R box 7 codes you use.

@txpharmguy0330 

[fanfare]

 "wait until I receive the 1099-R and file with my 2024 return?"

Earnings go on your 2023 return, 2024 has nothing to do with it.

positive earnings removed are no longer penalized 10% if you are under age 59 1/2. (eliminated in 2023)

@txpharmguy0330 

[txpharmguy0330]

I have the exact numbers. I was just using them for conversation's sake. I appreciate the quick response. I just was perplexed as to why I wouldn't get a 1099-R until next year. I'll just place it in my 2023 folder when it arrives next Feb. 

[fanfare]

"just enter contributions on line 1 and earnings in 2b), "

The total distribution goes into Box 1.

@txpharmguy0330 

[fanfare]

I'm thinking now since the gross distribution occurred in 2024, Line 4a should be -0-.

One way to make this happen with my tax software, the amended gross distribution in your made-up 1099-R should be the taxable amount shown also in Box 2a.

Use "8J" as the distribution code, and check "taxable amount not determined" box in 2b. Do not check the IRA/SEP/SIMPLE box.

That would put the taxable part on Line 4b and zero on Line 4a.

TurboTax may handle such a 1099-R differently.

@txpharmguy0330