I entered $7,000 for each of our traditional IRA contributions

What is your question?

When I entered $7,000 for each of our traditional IRA contribution for 2021, TurboTax reported I would have to pay a 6% penalty. However, this should not be the case. Now it seems I can't fix the problem. Any suggestions?

You entered a $7,000 traditional IRA for you and a $7,000 traditional IRA for your spouse and got the excess contribution warning? Did you have enough taxable compensation to make the contribution (Wages, self-employment)?

 

For 2021 the total contributions you make each year to all of your traditional IRAs  and Roth IRAs can't be more than:

• $6,000 ($7,000 if you're age 50 or older), or
• If less, your taxable compensation for the year

 

If you have indeed an excess contribution then to avoid the 6% tax on excess contributions, you must withdraw:

• the excess contributions from your IRA by the due date of your individual income tax return (including extensions); and
• any income earned on the excess contribution.