topic Excess Contributions - Contributions Withdrawn Before Due Date (for Roth IRA) in Retirement tax questions

Excess Contributions - Contributions Withdrawn Before Due Date (for Roth IRA)

User1001 — Wed, 19 Feb 2025 14:08:51 GMT

I made an excess contribution into my Roth IRA and withdrew it after TurboTax informed me of the excess. In TurboTax on the screen that says 'Contributions Withdrawn Before Due Date', should I enter the total amount of the excess + earnings? For example, if my excess contribution amount was $1000 and the total applicable earnings or loss was $100. Should I enter $1100 in TurboTax?

Re: Excess Contributions - Contributions Withdrawn Before Due Date (for Roth IRA)

MinhT1 — Wed, 19 Feb 2025 16:26:18 GMT

If you withdrew your 2024 excess contribution to your Roth IRA before the due date of the 2024 tax return (April 15, 2025), make sure that you also withdraw the related earnings.

On your 2024 tax return, you do not report the excess contribution as it has been withdrawn. The earnings have to reported and taxed in 2024.

For this, you would create a 2025 form 1099-R with the total distribution (excess plus earnings) in box 1, the earnings in box 2a and code PJ in box 7. You then enter this 1099-R on your tax return, and the earnings will be taxed. When entering this form 1099-R, make sure to indicate that the year on the form is 2025, as this is a replica of the form you will receive for year 2025 in 2026.

If there is a loss, that loss is not deductible.

When you receive the 2025 form 1099-R with code PJ in box 7 (in 2026) for this withdrawal, there is no further action needed.

[Edited 02/19/25 | 8:25 AM PST]

@User1001

Re: Excess Contributions - Contributions Withdrawn Before Due Date (for Roth IRA)

fanfare — Wed, 19 Feb 2025 15:41:27 GMT

DId you file the "excess plus earnings" form with custodian.?

If NO, your action is incorrect and will not result in the expected 1099-R

----

allocable earnings do not go on Misc Income.

---

allocable earnings:

positive earnings allocable to the excess are included in income on 1040 Line 4b for the year of the contribution. negative earnings are ignored; in any case, for purposes of basis, consider the original contribution amount as returned.

["Include the earnings in income for the year in which you made the contributions, not the year in
which you withdraw them."

]----

Genrally this is done in TurboTax by fabricating the 1099-R you expect later and entering it now.

@User1001

Re: Excess Contributions - Contributions Withdrawn Before Due Date (for Roth IRA)

User1001 — Wed, 19 Feb 2025 15:49:31 GMT

I filled out a form with the company that handles my Roth IRA for the excess amount and they determined the earnings on that amount then sent a letter saying they will be sending a check to me for the excess plus the earnings.

Re: Excess Contributions - Contributions Withdrawn Before Due Date (for Roth IRA)

Nigel809 — Thu, 12 Feb 2026 19:09:56 GMT

Hello,

I made a Roth contribution in 2025 at Fidelity, which is in excess of limits due to my MAGI being too high.

I plan to withdraw the excess plus earnings, prior to tax filing due date. So, when I report in TT my Roth contribution, do I just report the earnings, and not the original amount contributed, or how should this be handled? I fear this would not match the info that Fidelity would provide to the IRS regarding my Roth contribution.

TT does give me the option of reporting a re-characterization of Roth to Regular IRA, but not an option to report a 'timely' withdrawal. (I can't do a re-characterization since I dont have work income).

Also, does TT flag if the Roth Contribution is in excess of IRS limits once all the income numbers are entered (and MAGI calculated)?

Thank-you.

Re: Excess Contributions - Contributions Withdrawn Before Due Date (for Roth IRA)

RogerD1 — Thu, 12 Feb 2026 21:29:25 GMT

Yes, TurboTax will flag if the contribution is in excess. In the online version of TurboTax, at the end of the section on Deductions and credits, you will get a "Your Income Is Too High to Contribute" screen.

You'll be able to enter on the next screen the amount you plan to withdraw before the return due date.

To enter the earnings on the excess contribution:

Open your return
Click on the "Search" on the top and type “1099-R”
Click on “Jump to 1099-R”
Select "I'll type it in myself"
Box 1 enter total distribution (contribution plus earning)
Box 2 enter the earnings
Box 7 enter P and J

On the "Which year on Form 1099-R" screen say that this is a 2026 1099-R.

Re: Excess Contributions - Contributions Withdrawn Before Due Date (for Roth IRA)

Spent6CornfieldGrill — Sun, 08 Mar 2026 22:34:49 GMT

Hi,

I have a similar situation to the original poster (excess contribution withdrawal). I tried entering the 1099-R manually using the instructions above, but when I enter the tax that was withheld by my brokerage (Vanguard), the Form 1040 that TurboTax produces doesn't populate form 1040 item 25b (taxes withheld as reported on a 1099). This caused my e-file to be rejected by the federal government. Any advice?

Re: Excess Contributions - Contributions Withdrawn Before Due Date (for Roth IRA)

Nigel809 — Sun, 08 Mar 2026 22:48:33 GMT

Hello,

I haven't actually filed my tax return with the manually created 1099-R (for the excess contribution), so I dont know if I will have the same issue or not, when I do file. I didn't have any tax withheld on the excess contribution by the brokerage house, so maybe your entry of reporting tax withheld on a 1099-R that you created manually, is creating your snag?

Re: Excess Contributions - Contributions Withdrawn Before Due Date (for Roth IRA)

RogerD1 — Thu, 12 Mar 2026 15:44:48 GMT

@Spent6CornfieldGrill If you made a Roth contribution for 2025 that ended up being disallowed and you made a corrective distribution of the contribution plus earnings in 2026,we advise reporting the distribution plus earnings on a manually created 1099-R with the total distribution being the contribution + earnings and the taxable amount being just the earnings, with Box 7 codes of P and J and a tax year of 2026.

Now if you did do the corrective distribution in 2026 and had tax withheld on the distribution the tax withholding is for 2026 and not 2025. This would explain why the taxes withheld are not showing up on your 2025 tax return on line 25b. The rejection by the IRS is likely because you reported the withholdings on the earnings in TurboTax and the IRS could not match up the withholding you reported on your 1099-R. Go back in to TurboTax and remove the tax withholding in your 1099-R entry for the earnings distribution. You will be able to claim the withholdings on your 2026 return.

@Nigel809 Since you had no tax withheld on your earnings from the removed excess Roth contribution, you should be OK to proceed as I outlined in my first paragraph

Re: Excess Contributions - Contributions Withdrawn Before Due Date (for Roth IRA)

Nigel809 — Thu, 12 Mar 2026 18:32:17 GMT

Dear RogerD1

I think your advice on this topic is spot on, and I have done as you have suggested, for my 2025 tax return.

My follow up question concerns my return for 2026....

When I receive a 1099-R from my brokerage house (Fidelity) for 2026 (in Feb 2027), do I just ignore it, on my 2026 return, since I corrected excess contribution using a manually created 1099-R for 2026 already, with the P and J codes entered in box 7, as you noted.

Thanks

Nigel

Re: Excess Contributions - Contributions Withdrawn Before Due Date (for Roth IRA)

RogerD1 — Thu, 12 Mar 2026 19:28:03 GMT

@Nigel809 Yes you are correct. Since you will receive the 1099-R for 2026 but you have already reported that information on your 2025 return, you won't enter it on your 2026, but just keep it for your records.