topic Correct Roth overfunding in Retirement tax questions

Correct Roth overfunding

Russell23 — Wed, 03 Mar 2021 22:53:45 GMT

I erroneously overfunded my Roth by $7K on Jan 13, 2020 and then withdrew the $7K on Jan 21, 2020. Schwab issued a 1099R with an 8J distribution code. Is this correct? Is a 5329 even required in this instance? TT says there is no extra tax to pay because I took no withdrawals from a retirement account before retirement age.

Re: Correct Roth overfunding

macuser_22 — Wed, 03 Mar 2021 23:10:51 GMT

@Russell23 wrote:

I erroneously overfunded my Roth by $7K on Jan 13, 2020 and then withdrew the $7K on Jan 21, 2020. Schwab issued a 1099R with an 8J distribution code. Is this correct? Is a 5329 even required in this instance? TT says there is no extra tax to pay because I took no withdrawals from a retirement account before retirement age.

There should not be 5329. Be sure to delete the contribution if you entered it in the IRA contribution interview.

Only the gains (if any) in box 2a are taxable.

Re: Correct Roth overfunding

Russell23 — Sat, 06 Mar 2021 15:12:38 GMT

Thanks MACUSER, I always need the confirmation which makes my review clearer!