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sqt5022
New Member

Will I need to pay taxes on 1099-R amount for Roth IRA over contribution? Codes are PJ in box 7. The money was never invested.

 
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2 Replies
TomK2023
Expert Alumni

Will I need to pay taxes on 1099-R amount for Roth IRA over contribution? Codes are PJ in box 7. The money was never invested.

No, you will probably not pay any taxes since you withdrew your excess Roth IRA contribution before the tax-filing deadline (there should be no 10% early withdrawal penalty nor any 6% excise tax on the over-contribution).

 

You already paid taxes on the money you contributed to the Roth IRA; so taking that amount back out is tax-free.

 

However, if the account earned a few cents or dollars (e.g., in a sweep/money market fund), than any earnings distributed with the excess are taxable as ordinary income.

 

Code P on your 1099-R Identifies the distribution as a "Return of excess contributions taxable in the prior year."

 

Code J identifies an "Early distribution from a Roth IRA." (when paired with P, it just lets you & the IRS know that it was a Roth account).

 

Enter the 1099-R exactly as it appears; be sure to enter both P and J in Box 7.

 

Make sure Box 2a matches your form; if it is $0, no income will be added to your return.

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Drew3991
Returning Member

Will I need to pay taxes on 1099-R amount for Roth IRA over contribution? Codes are PJ in box 7. The money was never invested.

If this was on a 1099-R for 2025 with PJ in box 7, would an amended return still need to be filed for 2024 even though no additional taxes are owed from this 1099-R related to 2024? The funds were contributed to a Roth-IRA so the contributions have already been taxed.

 

For me the funds were invested but withdrawn March 2025 so before the filing deadline. My withdrawn funds resulted in a loss. Original contribution was $7,000 and gross distribution in box 1 is $6,675.84. I have a PJ in box 7 and no information in any other box besides  a $0.00 in box 2a.

 

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