Excess ROTH contribution withdrawn with a loss

Forum|Forum|5 years ago
March 31, 2021
1 reply
24 views

Removing ROTH contributions - both erroneously made in 2021 for tax years 2019 and 2020. They are the only contributions in the account. Account is in a loss situation. How to report the loss, etc?

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qbteachmt

Level 15

You are handling Corrective Distribution, not Loss reporting.

I like web articles meant for the investor, such as:

https://www.fool.com/retirement/plans/roth-ira/excess-contribution/

https://www.taxact.com/support/1280/2016/ira-or-roth-ira-excess-contributions

https://www.investopedia.com/articles/retirement/04/042804.asp

https://www08.wellsfargomedia.com/assets/pdf/personal/goals-retirement/taxes-and-retirement-planning/correct-excess-IRA-contributions.pdf

And of course, the IRS:

https://www.irs.gov/publications/p590a

Don't yell at us; we're volunteers

L

linduca1216Author

Level 6

"You can take into account any loss on the contribution while it was in the IRA when calculating the amount that must be withdrawn. If there was a loss, the net income you must withdraw may be a negative amount."

Am wondering how/where to enter amounts when this is the case.

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