Amend earning from excess Roth contribution

[yb53]

I am 71 year old and I made a Roth contritution $7,500 on Dec 15,2023.On early March 2024
I found out that my contribution was not qualified due to over income limited. I requested
Fidelity to remove an excess contribution and applicable earning. March 13, 2004 I received
a confirmation from Fidelity to withdraw $7,500 plus $316.72 earning. I filed tax return on
March 24 but I forgot to report $316.72 earning. How do I amend this earning in Turbo Tax
without the update 1099R. Please walk me through step by step.

[DanaB27]

You will get a 2024 Form 1099-R  in 2025 with codes P and J for the withdrawal of excess contributions and earnings. This 1099-R will have to be included on your 2023 tax return and you have two options:  

• You can wait until you receive the 2024 Form 1099-R in 2025 and amend your 2023 return or
• You can report it now in your 2023 return and ignore the 1099-R when it comes unless there is Box 4 Federal Tax withholding and/or Box 14 State withholding. Then you must enter the 2024 Form 1099-R into the 2024 tax return since the withholdings are reported in the year that the tax was withheld. The 2024 code P will not do anything to the 2024 tax return income but the withholdings will be applied to 2024.

To create a Form 1099-R in your 2023 return please follow the steps below:

1. Login to your TurboTax Account 
2. Click on the "Search" on the top right and type “1099-R” 
3. Click on “Jump to 1099-R”
4. Answer "Yes" to "Did you get a 1099-R in 2023?"
5. Select "I'll type it in myself"
6. Box 1 enter total distribution of $7,816.72 (contribution plus earning) 
7. Box 2a enter the earnings of $316.72
8. Box 7 enter J and P
9. Click "Continue"
10. On the "Which year on Form 1099-R" screen say that this is a 2024 Form 1099-R.
11. Click "Continue" after all 1099-R are entered and answer all the questions.
12. Continue until "Did you use your IRA to pay for any of these expenses?" screen and enter the amount of earnings under "Corrective distributions made before the due date of the return".

Please be aware, code P will say in the drop-down menu "Return of contribution taxable in 2022" but you can ignore that since the follow-up question will tell TurboTax that it will be taxable in 2023.

Generally it, is best to wait until the original return has been processed before amending the return. Please see How do I amend my federal tax return for this year?

[yb53]

Thank you for your help.