I am a 70 year old retiree and did a backdoor Roth IRA conversion in 2024. I followed the two steps instructions for entering a backdoor Roth IRA conversion listed in TurboTax Help.
On Step 1 item 8: "On the Tell Us How Much You Contributed screen, enter the amount..." I entered $7000 for my total traditional IRA contributions.
On Step 1 item 9: I answered No.
After answering the questions on the following screens, TurboTax said "Your IRA Contribution Isn't Permitted" because "I am not permitted to contribute more than the amount of my earned income". "Your traditional IRA contributions $7,000 is more than your earned income of zero.
Then TurboTax said I have a Penalty and I will owe a 6% penalty each year...
What did I do wrong? I am a retiree and I don't have earned income. Why do I need to pay penalty for a backdoor Roth IRA conversion?
