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My client made contributions to a Roth IRA that he was not eligible to contribute. He requested that the amount he deposited be returned to him. The fund company sent him a 1099R with the distribution code JP. I reviewed the drop down menu in Lacerte and there's no JP option. The drop down menu has the two codes separately:
J - Early distributions from a Roth IRA selection
P - Excess contributions plus earnings/excess deferrals taxable in 2019
I'm not sure which of these codes I should select or does Lacerte need to add a JP code?
Any thoughts on what I should do in this situation?
Thanks,
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There are two input boxes for the code(s). Put J in the first box and P in the second box.
Except that this is a 2019 item, so you can ignore it for the 2020 return. Client should amend 2019, if the income wasn't previously picked up there.