Amend a tax return for a missing 1099-R with Code R

[CBenj]

I wanted to open my traditional ira account but made a mistake opening a roth ira in February 2021 for tax year 2020. I then filed a recharacterization form to change it to traditional ira in March 2021. I just got a form 1099-R with code R and 2a box is zero. Do I need to amend my 2020 tax? If so, how should I do it? Please help

[ThomasM125]

If the contribution earned any income you should amend your 2020 tax return to report it, if you didn't report it when you filed the return.  Since the form 1099-R did not report the income, as box 2(a) is empty, it may be difficult to determine what the income is, however. 

If you do amend the return to report the income, you can enter it in box 2(a) when you enter the 1099-R. 

You can file an amended return using TurboTax for no additional fee. You will see the option on your Home Page in TurboTax, then under Your tax returns and documents, look for an option to Amend/Change your return. You should wait until you receive your refund or the IRS has processed your return, if you sent a payment, before you amend your tax return.

[CBenj]

Thank you. I put $3000 on my IRA mentioned and it's been less than that ever since. Do I still need to amend it? Do I also need to do anything with tax year 2021? Thank you

[DanaB27]

Yes, if you didn't report the recharacterization with the steps below then you will have to amend your 2020 tax return. If you reported it with the steps below then you can ignore the 1099-R with code R since a Form 1099-R with code R will do nothing to your return. You can only report it as mentioned below.

You will enter the recharacterization when you enter the contribution to the Roth IRA:

1. Login to your TurboTax Account 
2. Click on "Search" on the top right and type “IRA contributions” 
3. Click on “Jump to IRA contributions"
4. Select “Roth IRA”
5. Answer “No” to “Is This a Repayment of a Retirement Distribution
6. Enter the Roth contribution amount 
7. Answer “Yes” to the recharacterized question on the “Did You Change Your Mind?” screen and enter the contribution amount (no earnings or losses)
8. TurboTax will ask for an explanation statement where it should be stated that the original $xxx.xx plus $xxx.xx earnings (or loss) were recharacterized.
9. On the screen "Choose Not to Deduct IRA Contributions" answer "Yes" (if you are thinking about doing a backdoor Roth. If you have a retirement plan at work and are over the income limit it will be nondeductible automatically and you only get a warning and then a screen saying $0 is deductible)

@CBenj