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February 20, 2025
Question

Alabama - Roth IRA Excess Contribution Earnings

  • February 20, 2025
  • 0 replies
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Hi, I had excess Roth IRA contributions for 2023 tax year that I corrected in 2024. I got my 1099-R for the prior tax year (form says 2024 but uses code J, P). Everything looks good for the Federal side of things when I punched it in since I already fixed my 2023 return and including the earnings from the excess on 2023 return. I even got credit for the withheld tax on the form.

 

For my Alabama return, it appears the earnings isn't being treated as income? The online platform makes it very hard to figure out what is going on in the background, especially for state taxes. What should I do in this situation? Is there a way to add another source of income for state only?

 

For some ball park numbers. The distribution was $2000 (Box 1) with $300 being taxable (the earnings, box 2a). Box 16 shows a state distribution of the full distribution amount in Box 1, but only the earnings are taxable. Doing the math for 5% tax rate, the amount extra due is only about $15... just wanted to see if I could correct it.