section 333 of the secure 2.0 act 2024

[BPFLOYD]

Turbotax home&business 2024 desktop. guess I'm too complicated...?

I have 3 1099r well 2 I created 3rd.

1. I converted $ from Ira to Roth Ira, so I owe taxes. 1099r. TurboTax ok

2. I also added yearly contributions $8000 to Roth which I found out I can't, so I withdrew but I have to pay taxes on earnings. excess contributions, but TurboTax wants to add 10% penalty, which section 333 of the secure 2.0 act eliminated the 10% early withdrawal penalty on earnings for excess contributions using the timely correction. 

3. I also have 1099r for pension, taxes already withheld but then TurboTax adds $1000 I owe. why?

HELP ! please....

[DaveF1006 · Accepted solution]

To remove the 10% penalty amount, you first ‌need to report in your return that you removed the excess contribution by April 15. You will then prepare a 1099R entry to report the removal of the excess contribution. Here is how to report the 1099R.

1. Box 1 enter total distribution (contribution plus earnings.
2. Box 2a enter the earnings
3. Box 7 enter J and P These will be two separate entries
4. Click "Continue"
5. On "Is the IRA/SEP/SIMPLE box on this 1099-R checked?" screen answer "No, the box is blank"?
6. On the "Which year on Form 1099-R" screen say that this is a 2025 Form 1099-R.
7. Click "Continue" after all 1099-R are entered and answer all the questions.
8. Continue until "Did you use your IRA to pay for any of these expenses?" screen and enter the amount of earnings under "Corrective distributions made before the due date of the return".

As far as the 1099R with extra tax, this may have happened for two reasons. 

• The extra income may have placed you in a higher tax bracket
• There may have not been enough tax withheld.

Check your entry just to make sure your tax is withheld  and reported in Box 4 in your TurboTax program.

[BPFLOYD]

Thanks, @DaveF1006

I finally found "Corrective distributions made before the due date of the return" and checked the box and 10% penalty is gone. But have To pay taxes on earnings.

And Ira to Roth conversion was more taxes.

So everything is cool now!

Boy this has been a ruff learning experience this tax year...

Thanks again!  😊

[BPFLOYD]

@DaveF1006

6. On the "Which year on Form 1099-R" screen say that this is a 2025 Form 1099-R.

Hi, Dave, you said to do this, on line 6, looking back at my 2024 Return, I goofed up and put 2024 instead of 2025.

Will this cause an audit this year 2026 when they receive the real 1099-R from payer with 2025 on it?

Do I need to amend 2024 return, Form 4852 Line 6 to year 2025?

Just want to be extra sure.

Thanks!

[DaveF1006]

Entering 2024 instead of 2025 on Form 4852, Line 6, won’t cause an audit by itself. Here’s why, and what to keep in mind if you’re considering making changes.

1. Form 4852 is a substitute for a missing or incorrect Form 1099‑R. When the IRS receives your actual 1099‑R for 2025, they will match it to your 2025 return, not your 2024 return.
2. On your 2024 return, the IRS only cares about:

• The income amount you reported
• The tax withholding you reported
• Whether those numbers make sense for 2024

The year you typed on Line 6 of Form 4852 is not used for matching. It’s informational only. So no, this shouldn't cause an audit in 2026.

Now the question is "Do you need to amend your 2024 return?" In almost all cases: No. You would amend only if:

1. The income you reported was wrong 
2. The withholding was wrong
3. The distribution actually belonged to 2025, not 2024

But if the only mistake was typing 2024 instead of 2025 on Line 6, and the numbers themselves were correct for 2024, then an amendment is unnecessary. The IRS does not require amending returns over clerical details like this. 

@BPFLOYD 

[BPFLOYD]

1. Form 4852 is a substitute for a missing or incorrect Form 1099‑R. When the IRS receives your actual 1099‑R for 2025, they will match it to your 2025 return, not your 2024 return.

But It will not match my 2025 return because I put the taxable amount in my 2024 return.

So that is my concern. 

@DaveF1006 

[DianeW777]

There will be no issue for your 2025 tax return. The codes in the 1099-R should correctly process the amounts and only the earnings (that were removed in April, 2025, would be taxed on your 2025 tax return.

@BPFLOYD 

[BPFLOYD]

I already paid the taxes a year early on the 2024 return, but I removed earnings in April 2025.

Wouldn't it be a red flag for 2025 return when I do not enter the taxble amount from the official 1099-R they got this year from payer?

[RogerD1]

Since you already reported this 1099-R on your 2024 tax return and designated on that return that it was a 1099-R for 2025, then it has already been accounted for in your tax filings and need not be reported again on your 2025.  Just keep the 1099-R with your tax records and you should be good to go.