The calculation for my Roth IRA contribution is showing zero for AGI, but my AGI is not zero. How do I correct this?

beckynepal,

 

TurboTax may be correct here.  While no one in this forum can see your tax return, a very good thing,  the test for Roth contributions relies on a modified AGI rather than the basic federal AGI.  Use worksheet 2 on page 39 of IRS Publication 590A to calculate that figure for your own situation.  Let us know if that resulted in the zero you are seeing.

Please be aware that you need earned income to make IRA contributions.

 

For 2022 the total contributions you make each year to all of your traditional IRAs and Roth IRAs can't be more than:

• $6,000 ($7,000 if you're age 50 or older), or
• If less, your taxable compensation for the year

 

Also, your Roth IRA contribution may be limited based on your filing status and income. Please see  Amount of Roth IRA Contributions You Can Make for 2022 and Modified Adjusted Gross Income for Roth IRA Purposes worksheet for details.

 

Excess contributions are taxed at 6% per year for each year the excess amounts remain in the IRA. The tax can't be more than 6% of the combined value of all your IRAs as of the end of the tax year.

To avoid the 6% tax on excess contributions, you must withdraw:

• the excess contributions from your IRA by the due date of your individual income tax return (including extensions); and
• any income earned on the excess contribution.

 

If you have an excess contribution then please request with your financial institute to have the excess contribution plus earnings withdrawn by the due date. This distribution will have to be reported on your 2022 tax return but only the earnings will be taxable income and subject to the 10% early withdrawal penalty if you are under 59 ½.

My Modified AGI shows as 66,252 on the Roth IRA Contribution sheet

However no amount shows up on line 7  (wages and other earned income), thus looking like an over contribution.

All continues to charge 6% penalty for over-contribution, and says I will continue to be charged this.

I do have the Foreign Earned Income Exclusion, but again I have income much in excess of the amount I put into Roth

Yes, you must have earned income and it must be taxable on your return to contribute to a Roth, or traditional IRA. 

 

If all of your wages are not taxable due to the Foreign Earned Income Exclusion, you do not have earned income to justify an IRA contribution. 

 

The image below shows what is and is not compensation for the purpose of contributing to an IRA. It is from IRS Publication 590-A.