Substitute 1099-R or wait until next year and amend?

[philly2024]

Hi!

I started working on my taxes a few weeks ago and realized I made an excess contribution for my Roth IRA. I contacted the broker, and they removed the contribution and the gains but they won't send the 1099-R until next year.

Should I wait until then and file a 2023 amendment? Or should I do a substitute 1099-R with these numbers? Any benefit to one way or another?

Thank you!

[DaveF1006 · Accepted solution]

I would suggest reporting the withdrawal of the excess contribution on your 2023 return in the following manner.

1. Open (continue) return if you don't already have it open.
2. Inside TurboTax, search for 1099-R and select the Jump to link in the search results.
3. Answer Yes on the Your 1099-R screen,
4. Click on the box that you are creating a substitute 1099-R
5. Then select Continue.
6. In order to create a substitute 1099-R, you will need to obtain and name, address, and payer TIN as required so you can record the information properly on the form. 

The codes you will need for box 7 are J and P. Since this is a Roth IRA the only amount that is taxable are any earnings on the excess contribution. 

You will receive a 1099-R for the withdrawal in 2024 you do not need to report the information since you have reported it on your 2023 tax return.

[philly2024]

Thank you, @DaveF1006. Would the codes be J & P or 8 & J since it was a 2023 contribution, not 2022?

And do I leave section 8-12 blank? 

Thank you!

[DaveF1006]

According to the Turbo Tax post written by DanaB27, you will still use codes J & P. Leave sections 8-12 blank.

@philly2024 

[charlieandjillian]

Hello,

I completed the same process for the exact same situation (created 1099-R by using "type it in myself" feature and used codes J and P, chose year 2024 when prompted). The distribution amount and the taxable earnings on the distribution are showing up correctly in my 1040 form.

However, TurboTax prompted me to attach a copy of my 1099-R to my return. Since I won't receive my 1099-R until 2024, I can't attach a copy of it. Any suggestions on how to go about attaching some kind of form? Do I need to use Form 4852?

Thank you in advance for reading this!

[DanaB27]

To clarify, are you e-filing or mailing your return? 

You only need to provide a copy if you had tax withholdings.  If there is no tax withholding shown, there is no requirement to provide a copy of the Form 1099-R. If your Form 1099-R shows tax withholding, TurboTax automatically includes the details of the Form 1099-R in your e-filing. 

If you had taxes withheld don't enter them on your 2023 return they will need to be reported next year when you get the 2024 Form 1099-R since the withholdings are reported in the year that the tax was withheld. The 2024 code P will not do anything to the 2024 tax return income but the withholdings will be applied to 2024.

@charlieandjillian 

[absmile]

Hi all - similar question. I filed a substitute 1099-r last year due to a distribution in 2023 for an overage in 2022 to my 401k. I received the actual 1099-r from my brokerage firm in 2023. Comparing the two, I listed the correct amount of money distributed, the correct taxes paid, the correct code (P), but the description of the company name and TIN are different.

Am I okay as stated above to not include the actual 1099-r this year, since I filed the substitute one? What about those discretions? 

Thank you!

[DanaB27]

If you had taxes withheld in box 4 or 14 then you will enter the 2023 Form 1099-R with code P on your 2023 tax return since the withholdings are reported in the year that the tax was withheld. The 2023 code P will tell TurboTax to ignore the income but the withholdings will be applied to 2023.

Please see Pub 525 for additional information.

@absmile 

[absmile]

Thank you! No taxes were withheld - so can I just leave it as is? 

[DanaB27]

Yes, then you do not need to enter the Form 1099-R anywhere.

@absmile