In '22 I removed ROTH IRA excess contributions

Please be aware, you will have to pay the 6% penalty on the 2020 excess for 2020 and 2021 since it was still in the account on December 31, 2021. You didn't need to withdraw the earnings with the 2020 excess since it was after the 2020 tax due date. You should get a 2022 Form 1099-R with code J. It will be treated as a regular distribution and will be taxable in 2022. 

If you didn't enter the Roth contribution for 2020 on your 2020 tax return and paid the 6% penalty then you will have to amend your 2020 tax return and enter the Roth contribution.

On your 2021 tax return please follow these steps:

1. Click on "Search" on the top right and type “IRA contributions” 
2. Click on “Jump to IRA contributions"
3. Select “Roth IRA”
4. Enter the Roth contribution amount of $7,000
5. On the "Do you have any Excess Roth Contributions" answer "Yes"
6. On the "Enter Excess Contributions" screen enter the excess contribution from 2020 ($7,000)
7. Continue until you get to the penalty screen and enter $7,000 as withdrawn by the due date.

You will only pay the 6% penalty on the 2020 excess amount.

You will get a 2022 Form 1099-R  in 2023 with codes P and J for the withdrawal of the 2021 excess contribution and earnings. This 1099-R will have to be included on your 2021 tax return and you have two options:  

• You can wait until you receive the 2022 Form 1099-R in 2023 and amend your 2021 return or
• You can report it now in your 2021 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 2022 Form 1099-R into the 2022 tax return since the withholdings are reported in the year that the tax was withheld. The 2022 code P will not do anything to the 2022 tax return but the withholdings will be applied to 2022.

To create a Form 1099-R in your 2021 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 2021?"
5. Select "I'll type it in myself"
6. Box 1 enter total distribution (contribution plus earning)
7. Box 2a enter the earnings
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 2022 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 "Another reason" if you are over 59 1/2 (if you are under 59 1/2 click "Continue")

Please be aware, code P will say in the drop-down menu "Return of contribution taxable in 2020" you can ignore that since the follow-up question will tell TurboTax that it will be taxable in 2021.