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Incorrect 1099-R from Robinhood

Last year (tax year 2024) I made an excess Roth contribution - the contribution was made in 2025 and withdrawn (+ earnings/losses) before the April 15 deadline. This year I received a "2025 1099-R" from Robinhood with distribution codes J, P when, in fact, I was expecting codes J, 8. The "P" instead of "8" forces me to (incorrectly) amend my 2024 return ... there's nothing to amend for 2024. TurboTax concurs:
"Made the contribution to the Roth IRA in 2025 but it counted as a 2024 contribution, and withdrew the contribution in 2025: If you made the contribution to your Roth IRA in 2025 (between January 1, 2025 and the 2024 filing deadline without extensions), but you designated it as a 2024 contribution, and you withdrew it in 2025, the Form 1099-R you get will be for 2025. Include the Form 1099-R on your 2025 return. Your Form 1099-R will have a code 8 and a code J in box 7."
The IRS Publication 590-A is also very clear: "Withdrawal of excess contributions: for purposes of determining excess contributions, any contribution that is withdrawn on or before the due date (including extensions) for filing your tax return for the year is treated as an amount not contributed. This treatment only applies if any earnings on the contributions are also withdrawn. The earnings are considered earned and received in the year the excess contribution was made." The last sentence applies to my case - code "P" (P--Excess contributions plus earnings/excess deferrals (and/or earnings) taxable in 2024 or a previous year.) assigned by Robinhood is therefore incorrect. Code "8" (8--Excess contributions plus earnings/excess deferrals (and/or earnings) taxable in 2025.) is therefore correct. Common sense: why would I be taxed in 2024 for a contribution/earnings made in 2025?!
I chatted with Robinhood: first the AI agent was involved; it said I'm wrong and Robinhood is correct. Then I talked to a Robinhood agent and he said "... in regards to the distribution code J, 8. This "8" value is shown for Excess contributions plus earnings/excess deferrals (and/or earnings) taxable in 2025 however for your return of excess which you completed in 2025, this was a prior year return of excess. We do see that based on the form that you completed and the contributions being returned coming from 2024 contributions, the "P" value shown is correct. The "P" code value is for Excess contributions plus earnings/excess deferrals (and/or earnings) taxable in 2024 or a previous year which is what your return of excess constituted. I can definitely submit an escalation here so our back office can take a look into this further for us. Just based off what I see even though the contribution was made in 2025, it was made as a prior year contribution which means that it was a contribution for 2024 not 2025 meaning that it would be taxable for 2024, but because you do believe this to be incorrect, I'll get this escalation submitted so the team can review this further for you."

It's been a couple days and have not heard back from Robinhood: just in case they stand their ground, or I am wrong, I would like to hear other people's opinions.

Thank you!

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2 Replies

Incorrect 1099-R from Robinhood

Update: Robinhood got back to me and said that they are right and I'm wrong ! ?! ?!

Incorrect 1099-R from Robinhood

Second Update: I got another call from Robinhood "Retirement Supervisor" - he explained to me that code P, "instead" of 8, is set in stone on the 2025 1099-R and it's the only thing on this form that indicates that the distribution (withdrawal of excess contribution) is for tax year 2024 (or earlier) contribution; and so code 8 instead of P would be incorrect.

 

The above contradicts what TurboTax (2025 Premier desktop edition) "says":

Made the contribution to the Roth IRA in 2025 but it counted as a 2024 contribution, and withdrew the contribution in 2025: If you made the contribution to your Roth IRA in 2025 (between January 1, 2025 and the 2024 filing deadline without extensions), but you designated it as a 2024 contribution, and you withdrew it in 2025, the Form 1099-R you get will be for 2025. Include the Form 1099-R on your 2025 return.
Your Form 1099-R will have a code 8 and a code J in box 7.

 

I've been doing more research and it appears that the wording in IRS Publication 590-A: "The earnings are considered earned and received in the year the excess contribution was made." is ambiguous and most tax professionals interpret it as "(TAX) year the excess contribution was made" and not "(CALENDAR) year the excess contribution was made".

 

I'm still trying to figure this issue out but it looks more and more like I will have to amend my 2024 return.

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