Question

SEP IRA contribution and then quickly withdrawing due to overcontribution

Forum|Forum|6 years ago
March 10, 2020
1 reply
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Hi,

I made a contribution of 10k to my SEP IRA, realized I overcontributed, and then quickly withdrew the 10k. I was issued a 1099-R and TurboTax says I have to pay $1k early withdrawal fee.

How can I correct this to indicate that it was a withdrawal for over-contribution? I remember I made this mistake before, and there was some questions TurboTax asked me and I filled in it was a withdrawal for early contribution, and I was only taxed on the gains for that early withdrawal amount.

DaveF1006

There should have been a code P-return of contribution taxable in 2018 in Box 7 of the 1099R. By selecting this, this will render this distribution non-taxable. You might wish to ask the issuer for a corrected 1099R.

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