I overcontributed to a Roth but had it refunded prior to the 2017 filing deadline. How do I report this to avoid a penalty or paying taxes on this for 2017 and 2018?

[je10silvers]

I over-contributed to my Roth in 2017 but had it refunded in February 2018 so it was prior to the 2017 tax filing deadline. However, because the refund transaction took place in 2018, I will not receive a revised 5498 or 1099-R for it until next year but can calculate the taxable earnings from the over-contribution based on the refund I received. The 5498 submitted to the IRS for 2017 shows the over-contributed amount.

How do I report this to avoid a penalty for the over-contribution or having to amend my 2017 when I receive the forms in 2019?  Can I report this for 2017 even though I have not yet received the correct tax forms for it?

[DanielV01 · Accepted solution]

Yes, you "report" this in 2017, in a manner of speaking.  Please click on the following link for a fuller consideration of this:  Your Options If You Contribute Too Much to Your Roth IRA.  When you withdraw an excess contribution, it is considered as never happening, with the exception of the earnings (which must be included in income.  This income is included with your 2017 return).  Make sure that your plan administrator has characterized your withdrawal as an excessive contribution withdrawal, and save the documentation in case the IRS does ask questions.

{Edited 2/26/18: 18:56 PST}

[je10silvers]

This response is helpful but I have one clarifying question. The articles quotes the IRS saying that "The earnings are considered earned and received in the year the excess contribution was made." So, that tells me I need to report the earnings on the excess contrition with my 2017 tax return. How do I do this since I will not receive the 1099-R for it until 2019?

[DanielV01]

You shouldn't receive a 1099-R if the plan administrator reports this correctly.  (Because the contribution "never happened".)  However, since you are talking about one year: you know how much you received when the excess was withdrawn, and there is a way to find the amount you had originally contributed.  Subtract the amount you contributed from the amount you received upon distribution; whatever is left over are the earnings you must report.  These can be reported as Other Income, which will end up on line 21.