Return of excess contributions

Forum|Forum|7 years ago
June 6, 2019
3 replies
23 views

How do I report "return of excess" for Roth IRA contributions? I funded a Roth IRA for 2014, 2015, and 2016, but exceeded the income limits. I completed a recharacterization of funds for 2016, and a return of excess for contributions made in 2014 and 2015. How do I claim these on my tax return?

TurboTax Self Employed Online

hbl3973

Alumni - Champ

If you are using the desktop version, look for Form 5329. Question: did you already report the 2014 and 2015 excess contributions on those tax returns or amended tax returns?

mccoolgAuthor

Level 2

I am using the web-based Turbo Tax. As for 2014 and 2015, those were liquidated and return of excess completed in Feb 2017, so I need to claim them and presumably pay the 6% penalty. Is this done on my 2016 return? How?

hbl3973

Alumni - Champ

According to

https://ttlc.intuit.com/questions/2690250-how-to-access-form-5329-using-online-turbotax-without-1099...

you can't prepare a 5329 using the online version of TT. You can prepare a paper version version by hand.

At this point you need to take the following steps:

(1) Prepare a 2014 Form 5329 and amend (Form 1040X) your 2014 tax return. (Amended returns are always filed on paper.) To find that 5329 form, Google "form 5329 2014 site:irs.gov".

(2) Using the 2014 Form 5329, prepare a 2015 Form 5329 and amend your 2015 tax return.

(3) Using your 2015 Form 5329, prepare a 2016 Form 5329 and complete your 2016 taxes, opting to print and mail. The Form 5329 shows "Attachment Sequence 29" and you insert it accordingly ahead of those, if any, with sequence numbers less than 29 and before any with sequence numbers greater than 29.

The IRS will eventually process these paper returns and send you a bill for underpayment interest that has accumulated over the past 2 or 3 years.

Send all the above by Certified Mail at the US Post Office (no need for anything else, e.g. return receipt or insurance, only that green slip stamped by the postal clerk). This gives you tracking information so that you can determine the precise date at which the amended returns were received by the IRS, stopping the interest clocks.