Will you explain what additional tax on excess contributions or deductions means?

An excess contribution is if you contributed more than the allowed amount. If you have an excess contribution TurboTax will warn you and calculate the 6% penalty on the penalty screen in the IRA contribution interview.

For 2023 the total contributions you make each year to all of your traditional IRAs and Roth IRAs can't be more than:

• $6,500 ($7,500 if you're age 50 or older), or
• If less, your taxable compensation for the year

Also, your Roth IRA contribution may be limited based on your filing status and income. Please see 2023 - Amount of Roth IRA Contributions You Can Make for 2023 for details.

If you get a warning that you cannot deduct a traditional IRA contribution because of your income and a retirement plan at work then this mean you can make the contribution but you cannot deduct it. In this case the basis will be tracked on Form 8606. Please see IRA deduction limits for details.

If you have an excess contribution then you can request the withdrawal of excess contribution plus earnings until October 15, 2024 to avoid the 6% penalty. The earnings will be taxable in the year in which the excess contribution was made.