Return of Excess Contribution on Roth IRA: Amend 2025 Tax Return?

Pizzacrust28

Hello, I'm looking to get some guidance because of a change in status. Here's a timeline of events:

1. I filed 1040 as a single filer status in 2025 by mistake since I got married in 2025. So I filed an Amended return to correct the status as married filing separately, removed the student loan interest as it is no longer deductible and added my Roth IRA contribution (forgot to add it).
2. Come to realize later on, our combined MAGI as a couple may have exceeded the Roth IRA income limit. That means whatever amount I contributed in 2025 and this year are excess contributions so I filed a return of those funds in Fidelity. I'm no longer contributing to the Roth IRA (nope!).

Question I have is, now that I have filed the return of excess contributions, should I file an amended return again? If so, how should I start? I'm aware that there should be a penalty for 2025 for missing the deadline to return the excess contribution. Any help or ideas would be great, thank you!

GregW

First, let's clear up what may be a misconception.  Since you filed separately, your combined income has no bearing on the Roth income limit.  Only your MAGI, reported on your own return, will matter.  That
said, since you filed separately and assuming that you lived with your spouse at some point during the year, the income limit is only $10,000.  The amount you can contribute to a Roth phases out from $0 to $10,000 and above $10,000, no contributions are allowed.

So it is likely that all of your contributions will be excess. When you asked Fidelity to return your excess contributions, they should also have returned any earnings from those contributions.  You will only owe
tax on those earnings.  You should file another amended return to report those earnings and pay any tax due on them.  If you filed your original return on time, and you withdrew the excess contributions and file the amended return within six months from the due date (that is, by Oct. 15), you should not owe the 6% penalty. 

If you file a paper amended return, you should write “Filed pursuant to section 301.9100-2” at the top.  This refers to the regulations that provide the automatic six month extension to make the correction.

If you filed both the original return and the first amendment electronically, you should be able to file another amendment electronically.  You should only report the return of contributions you made for 2025.  Wait until next year to report the return of 2026 contributions.  For the amended return, add a Form 1099-R and report the total amount you received in box 1 and the earnings (only) in box 2a. 
Use code JP for box 7.  (You will receive the actual form 1099-R next year - if you file the amendment now as suggested and the 1099-R you receive matches what you file now, you can ignore it.)

MatthewD

Hi Pizzacrust28,

You may want to refer to this article in the Community:

https://community.freetaxusa.com/kb/articles/433-how-do-i-report-the-withdrawal-of-excess-roth-ira-contributions-on-my-tax-return

We recently published articles that cover several situations for excess Roth contributions.