You are correct the received Form 1099-R isn't filled out correctly. You should contact your financial institution.
Form 1099-R instructions state: "For the distribution of excess Roth IRA contributions, report the gross distribution in box 1 and only the earnings in box 2a. Enter Code J and Code 8 or P in box 7."
Be sure that you did not enter the corrected Form 1099-R on its own, but that you combined the original Form 1099-R and the values that were changed on the corrected Form 1099-R and there is only a single Form 1099-R being reported for the two forms.
If there is still a problem, please share exactly what the message is saying regarding the $0 taxable amount.
I confirm that there is only a single 1099-R entered into TurboTax and I have only amended the fields marked as 'C' (corrected) in the newest form presented to me. In this case that means changing:
- Box 1 Gross distribution
- from a non-zero amount
- to 0.00
- Box 2b Taxable amount not determined
- from [X] checked
- to [ ] unchecked
- Box 7 Distribution codes
- from 8J
- to 8J
- (not sure why this is considered corrected but whatever)
- Box 15 State/Payers State Number
- from OR - 01658557-1
- to OR
- Box 16 State Distribution
- from a non-zero amount
- to 0.00
I submit this information in the Wages & Income subsection and the issue only arises when the review is performed at the end, saying:
"Form 1099-R: Gross distribution amount should have a value and should be greater that $0.50"
Not really sure where to go from here because these are the hard numbers given to me on the 1099-R.
Did you take an early withdrawal from a Roth IRA and then return the funds back to the account to reverse the early distribution in 2024?
Not exactly - I made the contributions to the Roth IRA in error as I did not know about the MAGI limit which I exceeded. Therefore I withdrew the funds from the Roth IRA and have talked with the clearing company to try to get it designated appropriately as an overcontribution for the full amount and the withdrawal as a correction of this overcontribution.
I initially received a 1099-R from them just specifying that my full withdrawal was taxable, which should not be the case considering it was made in error, however the corrected document they sent back to me just specified 0.00 for the gross distribution which doesn't feel right either. I don't want to be fraudulent and give a number that isn't true but TurboTax doesn't allow me to proceed with a value less than 0.50 according to this error message.
You are correct the received Form 1099-R isn't filled out correctly. You should contact your financial institution.
Form 1099-R instructions state: "For the distribution of excess Roth IRA contributions, report the gross distribution in box 1 and only the earnings in box 2a. Enter Code J and Code 8 or P in box 7."