Correcting 1099-R Coding: Excess Roth Contribution Removed, but Coded as "J" instead of "P"

[JS98651321]

Hi everyone,

I’m looking for guidance on how to report a 1099-R coding issue on my 2025 tax return.

The Situation:

• Nov 2024: Opened a Roth IRA with Fidelity and made a contribution (3K).
• March 2025: Realized I was ineligible for Roth contributions due to income limits.
• April 7, 2025: I withdrew the entire contribution to correct the error. The account balance has been $0 since that date.
• The Issue: Because I did not submit a formal "Return of Excess Contribution" request, Fidelity issued a 1099-R with Distribution Code J (Early Distribution) instead of Code P (Return of Excess). The form reflects the original contribution amount minus a $180 loss. 

My Questions:
While my tax software correctly shows no penalty (since the balance was $0 by the deadline), I am worried that the "J" code makes it look like a standard withdrawal rather than a timely correction.

1. If Fidelity refuses to issue a corrected 1099-R with Code P, should I use a Substitute 1099-R (Form 4852) to report the correct code myself?
2. Is it recommended to proactively attach an explanatory statement to my return to prove this was a timely removal of excess contributions?
3. How do I ensure the software reflects this as a "corrective distribution" so the IRS understands the excess was resolved before the tax deadline?

I’ve read that this is a common issue when formal removal forms aren't used. Any advice from those who have successfully navigated this—or experts who know how the IRS views a Code J in this context—would be greatly appreciated.

[MaxA1]

There's no further action needed.  What you did is correct.  The IRS won't think any differently of you if the code remains as "J" or is updated to "P".  The end result is the same, no tax or penalty on the distribution.  That is all the IRS cares about.  IF (and that's a big IF) the IRS sends a letter to further inquire about the distribution, you can clarify and show your support at that time.

[MNSE_gal]

Greetings, I had a similar situation of an excess contribution to a Roth IRA in the same timeframe as you're experienced.  However, I googled to find out what one should do and found I needed to submit a request for "Return of Excess Contribution" form [a lesson you're already learned unfortunately] this was completed prior to April 15, 2025 and before I filed 2024 Tax Return.
The money I received back included the excess amt plus the earnings on that money, so when I received my 1099-R 2025 Box 7 had JP. I knew I needed to report the earns as taxable income; unfortunately the IRS rules and TurboxTax don't make it easy to do. [I need to do a 2024 amendment for under $800!!...what a pain!]

Since you had a loss on the overall excess contribution amt, you may not need to worry about the distribution code on  your 1099-R.  Curious, do you normally contribute to a Roth IRA every year? Recommend reading up on Form 5329  & Pub on IRS website.

[dmertz]

@MNSE_gal , if the amount shown in box 2a of the code-JP Form 1099-R was not reported on your 2024 tax return, you need to amend your 2024 tax return.

With code J instead of code JP, if the 2024 tax return did not report the excess contribution on Form 5329, one needs to submit a substitute 2025 Form 1099-R (Form 4852) to show that this constitutes a return of the excess contribution before the due date of your 2024 tax return.

If the 2024 tax return did not report the excess contribution on Form 5329 and one simply report the code-J Form 1099-R as received, one would need to amend your 2024 tax return to pay the 6% excess-contribution penalty.