In 2019, I had made a contribution to my traditional IRA for the max and now found out that we exceeded the MAGI for 2019 taxes. What to do with the 2019 IRA contribution that was made?
Do we pull it out (and how), fill out form 8606, or do nothing??
Yes, you can remove the contribution by contacting your financial institution. Be sure to let them know you are requesting a return of an excess contribution. They will return the contribution to you along with any earnings on the contribution and next year, you will have a 1099-R that reflects this. Alternately, you can leave it in and pay the penalty but the 6% penalty is charged each year that the contribution remains in the account. If you plan to remove the contribution, you should do so immediately and then remove the entry from TurboTax as well.
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If the contribution is nondeductible because you or your spouse was also covered by a workplace retirement plan, you can either leave it in and file Form 8606 to report the nondeductible contribution or you can obtain a return of contribution from the traditional IRA. The deadline for obtaining the return of contribution is July 15, 2020 unless you request a filing extension or file your tax return by the July 15 regular filing deadline, in which case the deadline for obtaining a return of contribution becomes October 15, 2020.
Since this is not an excess contribution, there is no 6% excess-contribution penalty.