@DanaB27 Thanks for the quick response.
The $500 was from 2021 nondeductible contribution to traditional. On top of the $4580 contributed in 2021, we rolled over her 401k from her old employer which the $500 is included in the whole value of her $18246 in traditional if that makes any sense. We forgot to convert this in 2021 and converted this $500 in 2022. We converted $4050 of the $4580 in 2021.
Also, I noticed when I increased the amount of how much I contributed in 2022 for year 2021 (I did $1920 for last year's return when it should actually be $2920) it increased my taxes due. Why is this the case?
EDIT: I was looking at our 2020 form for IRA information worksheet and I do have a question please:
Specifically: "Under Wages and Income"
- "Tell us the value of your traditional IRA": this value should be the same as the value when it asks this same question under "Deductions and Credits" of my "value of your traditional IRA" and says to "Include any IRA contributions I made of will make in 2021 for 2020"?
- This value should be $1000 correct? My 5498 says $0 for end of year, but I add my $1000 contribution from 2021 for 2020, and DO NOT add my $1000 recharacterization in 2021 for 2020.
- I just realized under “Wages and Income" I had my end of year value as $0, while under "Deductions and Credits" I had my end of year value as $1000.
- "Outstanding recharacterizations": this should be $1000 b/c of the $1000 I recharacterized in 2021 for 2020
Because my 8606 then becomes:
Line 1= 4000
Line 2= 0
Line 3 = 4000
Line 4 = 1000
Line 5 = 3000
Line 13 = 2097
Line 14 = 1903
Line 16 = 2203
Line 17 = 2097
Line 18 = 106
Thank you!
