Have the custodian process a return of excess contributions, including the attributable net income, by the applicable deadline. If the investment lost value, the amount returned can be less than the original contribution. A properly completed timely correction is treated as though the contribution was not made; an ordinary withdrawal is not automatically the same transaction.
Whether you need an amendment depends on the original reporting and correction timing. In particular, if you filed on time and then use the additional six-month correction procedure, IRS Publication 590-A directs you to file an amended return with “Filed pursuant to section 301.9100-2” at the top and report any related earnings for the contribution year.
A loss can leave no earnings to include, but does not remove that amendment instruction. Check any Form 5329 already filed and the corrective distribution’s reporting instructions; the year you receive Form 1099-R alone does not settle the reporting year.
Primary sources
Instructions for Form 8606 (2025) | Internal Revenue Service
Instructions for Form 5329 (2025) | Internal Revenue Service