I took out a distribution and returned a portion. Now program shows traditional excess contributions with penalty if not withcrawn?/?

[helmanenterprise]

I took out $550K for a business venture and found I did not need it all so I returned $200K into my IRA before the 60 day rule.  Now I'm showing traditional excess contributions of $192,000 and it says to avoid a penalty I can withdraw these excess contributions before the due date of the return.  Other option is if I had withdrawn all or some of these contributions to enter that amount.  I don't understand what these excesses are or what to do to avoid a penalty and I don't want to take out more money. 

[Opus 17 · Accepted solution]

Don't enter the return as a contribution, it is not a contribution.

Instead, when you enter the 1099-R for the withdrawal, there will be a screen that says something like "Let's look for ways to lower your taxes" and one of the options will be a rollover.  Indicate that you did a partial rollover of $200,000 (a return to the same IRA or a rollover to a different IRA are both considered rollovers.)