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Subject Author Date
Can I ignore my 2007 1099-R if I already took care of it? Duke of Hazard 03-30-2008
Posted by Duke of Hazard on March 30, 2008, 6:17 pm
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 In 2006 I over-contributed $2400 to a Roth IRA. So in 2007 I removed
the excess contribution and filed a 2006 Form 5329 to pay the 10% + 6%
penalty .

I still received a 2007 1099-R for the removal of my excess
contributions. Can I ignore it for my 2007 return since I already took
care of it with my 2006 5329?

--
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Posted by Phil Marti on March 30, 2008, 6:48 pm
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 "Duke of Hazard" wrote:

> In 2006 I over-contributed $2400 to a Roth IRA. So in 2007 I removed
> the excess contribution and filed a 2006 Form 5329 to pay the 10% + 6%
> penalty .

Something doesn't sound right. If you corrected the excess contribution and
the earnings on it by the extended due date of your 2006 return you didn't
owe the 6% penalty. (It makes a difference in what you need to do on your
2007 return.)

> I still received a 2007 1099-R for the removal of my excess
> contributions. Can I ignore it for my 2007 return since I already took
> care of it with my 2006 5329?

No, don't ignore it. What's the code in Box 7?

--
Phil Marti
Clarksburg, MD

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by Duke of Hazard on March 30, 2008, 7:14 pm
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> Something doesn't sound right. If you corrected the excess contribution and
> the earnings on it by the extended due date of your 2006 return you didn't
> owe the 6% penalty. (It makes a difference in what you need to do on your
> 2007 return.)

I corrected the 2006 excess contributions in 2008, so I think the 6%
penalty did apply.

> > I still received a 2007 1099-R for the removal of my excess
> > contributions. Can I ignore it for my 2007 return since I already took
> > care of it with my 2006 5329?
>
> No, don't ignore it. What's the code in Box 7?

The code in Box 7 is N. If I report this 1099-R , won't the IRS be
expecting the 10% early withdrawl penalty ( which I already paid ? )

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by Phil Marti on March 30, 2008, 8:15 pm
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"Duke of Hazard" wrote:

>> Something doesn't sound right. If you corrected the excess contribution
>> and
>> the earnings on it by the extended due date of your 2006 return you
>> didn't
>> owe the 6% penalty. (It makes a difference in what you need to do on
>> your
>> 2007 return.)
>
> I corrected the 2006 excess contributions in 2008, so I think the 6%
> penalty did apply.
>
>> > I still received a 2007 1099-R for the removal of my excess
>> > contributions. Can I ignore it for my 2007 return since I already took
>> > care of it with my 2006 5329?
>>
>> No, don't ignore it. What's the code in Box 7?
>
> The code in Box 7 is N. If I report this 1099-R , won't the IRS be
> expecting the 10% early withdrawl penalty ( which I already paid ? )

At the moment the "what to do with the 1099" cart is miles ahead of the
"what happened?" horse. Your explanation makes no sense.

Nothing you did in 2008 would be reflected on a 2007 1099-R. The code on
the 1099-R that you have indicates a 2007 recharacterization. (That code is
not necessarily right, but it doesn't match your account of what happened,
which would have resulted in no 2007 1099-R being issued.)

Please provide a complete timeline, with amounts, of what happened, starting
with the 2006 tax year.

--
Phil Marti
Clarksburg, MD

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by D. Stussy on March 31, 2008, 12:28 am
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> "Duke of Hazard" wrote:
> >> Something doesn't sound right. If you corrected the excess
contribution
> >> and
> >> the earnings on it by the extended due date of your 2006 return you
> >> didn't
> >> owe the 6% penalty. (It makes a difference in what you need to do on
> >> your
> >> 2007 return.)
> >
> > I corrected the 2006 excess contributions in 2008, so I think the 6%
> > penalty did apply.
> >
> >> > I still received a 2007 1099-R for the removal of my excess
> >> > contributions. Can I ignore it for my 2007 return since I already
took
> >> > care of it with my 2006 5329?
> >>
> >> No, don't ignore it. What's the code in Box 7?
> >
> > The code in Box 7 is N. If I report this 1099-R , won't the IRS be
> > expecting the 10% early withdrawl penalty ( which I already paid ? )
>
> At the moment the "what to do with the 1099" cart is miles ahead of the
> "what happened?" horse. Your explanation makes no sense.
>
> Nothing you did in 2008 would be reflected on a 2007 1099-R. The code on
> the 1099-R that you have indicates a 2007 recharacterization. (That code
is
> not necessarily right, but it doesn't match your account of what happened,
> which would have resulted in no 2007 1099-R being issued.)
>
> Please provide a complete timeline, with amounts, of what happened,
starting
> with the 2006 tax year.

If your correction of the 2006 problem wasn't until 2008, you may owe
another 6% in 2007.

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

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