Report 1099-R in 2025 or Amend 2024?

Aldo
Aldo Member Posts: 1 Newcomer
in Filing my taxes

Hi, I have a question about how to correctly report a Roth IRA excess contribution and the related 1099-R.

For tax year 2024, my earned income was $1,476, but I contributed $7,000 to a Roth IRA. After realizing the excess, I removed the excess contribution ($5,600) plus earnings ($931) on 02/27/2025 (before the tax filing deadline).

In 2026, I received a 2025 Form 1099-R with distribution code JP, showing:

  • Gross distribution: $6,531.79
  • Taxable amount: $931.37

My questions:

  1. Should I report this 1099-R only on my 2025 tax return, or do I instead need to amend my 2024 tax return? Or both?
  2. Since I removed the excess before the deadline, do I owe any penalties (e.g., 6% excess contribution penalty, 10% early withdrawal penalty)?

Thank you for your help!

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Answers

  • GeorgeM
    GeorgeM FreeTaxUSA Agent Posts: 99 image
    Hello Aldo:

    You will need to amend your 2024 tax return. There is nothing to report on your 2025 tax return as it relates to your 2024 excess Roth IRA contribution and its subsequent removal.

    Code P in box 7 of Form 1099-R means that your excess contribution, plus earnings, are taxable in 2024. Code J merely indicates that the distribution, or removal of the funds from the Roth IRA, was an early distribution for which there was no known exception, and in most cases involved a taxpayer under 59-1/2 years of age.

    Fortunately, because you removed the excess contribution, and earnings, prior to the 2024 tax filing deadline, you won’t be subject to the 6% penalty tax or the 10% early withdrawal tax.
  • murusa
    murusa Member Posts: 1 Newcomer

    Thanks for this question and answer. I'm in the same situation.

    I did recharacterization of my 2024 roth IRA and got money back in 2025. I received 2025 1099-R. The box 7 is "R". When I file this 1099-R in 2025 return, it says, i have to amend 2024? what should i change in 2024 amend filing?

    Thanks in advance.

  • MatthewD
    MatthewD FreeTaxUSA Admin, FreeTaxUSA Agent Posts: 1,032 image
    edited August 4

    Hello Murusa,

    When you do a recharacterization from a Roth IRA to a Traditional IRA (even if you do that in the following year) you need to indicate the recharacterization in the year you made the Roth IRA contribution and report the 1099-R in 2024 (the year you made the contribution). You may have some earning to report on your 2024 return. I suggest you read this article which has an example of how to report the recharacterization.

    https://community.freetaxusa.com/kb/articles/174-backdoor-roth-plus-a-recharacterization-recharacterization-happens-after-december-31st-2024-and-later

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