Form 1099-R - Excessive Roth IRA Contribution

[kevin1020]

I removed excessive withdrawal & earnings from my ROTH IRA account last year as I over-contributed in 2018. I didn't get the 1099-R until late last year, do I have to amend my 2018 taxes? Or could I just pay taxes on the earnings in 2019 tax year?

[DanaB27]

Yes, you will have to amend your 2018 taxes since the earnings are considered earned and received in the year the excess contribution was made. The 1099-R should have a code P—Excess contributions plus earnings/excess deferrals (and/or earnings) taxable in 2018 in box 7.

Please see How do I amend a 2018 return in TurboTax?

[kevin1020]

The code shows box 7 shows JP. When I tried to amend my 2018 return in turbo tax, code P says it's "return of taxable in 2017", should I just ignore that? I thought it would say "return of taxable in 2018" instead.

[DanaB27]

Yes, you can ignore it when entering the 1099-R form because TurboTax will ask what year is on the form after entering the 1099-R with code P. Answer 2019 and then TurboTax will know that it was taxable in 2018.

[jtdfp]

Hi Dana (and everyone)

@DanaB27 

I had a question regarding excess contribution to Roth IRA, - I was hoping for some last minute guidance. Here are the basics:

Made $1,800 in excess contributions during the 2019 calendar year

Realized made excess contributions last week BEFORE filing my taxes

Excess contributions withdrawn and earnings on excess contributions withdrawn (will be receiving checks for both)

Earnings on excess contributions in 2019 were $45.43

Do I have to report anything on my 2020 taxes that I am about to file (tomorrow!)?

What form/information do I need to report on my taxes before I file them (tomorrow) to avoid having to do an amendment? Is it a 2019 1099-R that will be sent to me that contains the information? (If so, going to try and get this information from the financial institute tomorrow - not sure if do-able).

Further, I realized excess contributions were made so far this year in 2020, I have already halted further contributions and requested those be withdrawn and sent to me along with earnings on the excess contributions. When I file in 2021 (for 2020 tax stuff) will I report this the same way - using a 1099-R form for the earnings on excess contributions?

Most importantly, thank you!