Hi,
I opened a Roth IRA account in June 2019 and started making contributions to it. I contributed $16k till 2021.
I withdrew $10k from the Roth IRA last year.
The 1099-R form has 'J' for box 7, which is 'early withdrawal from Roth IRA, no known exception'. I'm younger than 59 and based on what I read online, you can withdraw contributions w/o any taxes/penalties, at any age.
However, when I enter the 1099-R form info in turbo tax, it causes the taxes due to go up by $5k. I went to the 'tools' section, searched for form 8606 and entered the basis info in that form (entered how much I had contributed prior to 2024), but it didn't make any difference.
Any idea how to fix this? Are there other forms in the software that I need to fill?
Thanks.
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Yes, if you entered everything from your 1099-R, then continue after you see the population of the 1099-R to the additional questions. You will see a question that asks: "Enter Prior Year Roth IRA Contributions".
Enter $16,000, TurboTax will remove all the taxes on the Roth withdrawal of $10,000.
Thanks for the quick reply...that fixes the issue.
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