The excess contribution was due to our MAGI; we contributed $6000 during the year. But we are not eligible for a "recharacterization" to a traditional IRA contribution because we didn't have a traditional IRA in 2024. My Roth IRA contact said the distribution/withdrawal to be processed in the next 11 business days, and I expect the 1099-R for it on the same timeline. I don't know whether this will count as having fixed the excess contribution prior to the deadline. I don't know what the calculated earn/loss on the excess value is, but my guess is that the 10% tax on it represents less than $50, whereas the 6% penalty on the excess is around $180. Basically, I don't know which number to put as my Roth IRA contribution for 2024, or whether to file an amendment regardless, or just to file an extension.
Because you removed the excess before the due date of the tax return, you do not have to report it on your tax return, or pay the penalty for excess contribution. You will have to report the income earned for the excess contribution, but it will not be reported until next year on your 2025 1099-R. If you know the amount, you can add it now so that you do not have to amend.
If you made an excess Roth IRA contribution in 2024 and withdrew the 2024 excess Roth IRA contribution plus earnings in 2025 before the due date, then you will get a 2025 Form 1099-R in 2026 with codes P and J. This 1099-R will have to be included on your 2024 tax return and you have two options:
To enter a 2025 Form 1099-R in your 2024 return please follow the steps below:
Please be aware, code P will say in the drop-down menu "Return of contribution taxable in 2023" but you can ignore that since the follow-up question will tell TurboTax that it will be taxable in 2024.
@MaryK4thank you for the detailed, prompt, and comprehensive reply! Much appreciated. I was able to file with confidence.