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stur
Returning Member

Withdrawal of Roth IRA contributions before 59

I’ve read this is a problem people have had in the past. I am under 59 and withdrew money from a Roth IRA that was only contributions - no earnings. federal is not racing me on it but NJ is. On my 1099R there is a code J and it has the box checked  taxable amount not determined. 
I’ve had this for more than five years and this is the first time I withdrew. I only withdrew from it because I thought I would not be taxed by just taking out my contributions… and my withdrawal was less than my contributions amount.  Importing from federal taxes - NJ still taxes me. Do I even have to report it in my taxes to NJ. I read somewhere on Google you don’t have to include it. I gave the proof these were all contributions if  IRS reaches out to me, but I rather submit it if I can get the NJ turbo tax to work correctly….. any advice?

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2 Replies
KrisD15
Employee Tax Expert

Withdrawal of Roth IRA contributions before 59

Code J on a 1099-R usually indicates a contribution that was later revoked. 

That type of distribution is considered an Early Distribution and would be taxed. 

 

Can you provide any additional information for clarification of this distribution? 

 

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stur
Returning Member

Withdrawal of Roth IRA contributions before 59

Yes - I went over with a Vanguard agent on four separate occasions that specific transactions occurring from 1999 to the present time were contributions. Adding up those contributions I withdrew money in 2024 that was based only on the contributions. From everything I read I am not supposed to be taxed on these monies. I did not dip into any earnings. The federal tax program in turbotax did not tax me on this 1099-R withdrawal that only comprised of contributions. However, when transferring the information into the state - NJ taxes me. If I go back and leave out my 1099R for this distribution in federal - my taxes for NJ are much lower when everything else if left the same. Is there someway I can fix what appears to be a bug in the NJ state form. It states that NJ is suppose to follow same rules as Fed when it comes to this stuff and online it also states the you can take out contritubtions made to a roth IRA at anytime and it shouldn't be taxed.  I have read other threads on turbo tax and other users have had this same issue. 

 

I also read that you shouldn't put and income based on withdrawal of contributions on the NJ tax forms, but NJ qwill get my 1099-R and then contact me probably. I have the proof but I rather just somehow submit it upfront and state this withdrawal only comprises contributions.... .

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