Alan S. wrote:More likely, you did not complete the input showing your total contributions as 1,033. and were therefore taxed and penalized on the entire distribution of 1054 instead of just the earnings of $21. The 1099R will not provide any of this information, that has to come from your own record keeping and entry of your contribution amount. And remember that if you have any other Roth IRAs, for tax purposes they are combined as one, and that could change everything.
You're probably right, Alan. The OP probably entered the entire amount ($1054) rather than doing the math and entering $21. That $1k difference would definitely alter the tax bill by hundreds of dollars depending on tax bracket. Still, the OP should also check any credits they may have been claimed & got reduced if he/she claimed any. That could also be a factor.