DanaB27
Expert Alumni

Get your taxes done using TurboTax

It seems as if you entered everything correctly.

 

Yes, the total basis of December 31, 2019 is $6,000.

Yes, you entered $0 for the traditional IRA value and 6000 as outstanding recharacterizations correctly.

 

No, $7,907 for line 9 for the IRA distribution worksheet is correct. For each distribution/conversion an amount is allocated towards your basis. You didn't convert the recharacterized amount until 2021 therefore some of the basis is allocated to that amount.

 

When you file your 2021 tax return to report the conversion you will have the rest of basis $4,093 allocated to that conversion ($4,093 + $7,907 = $12,000 total basis used) assuming the traditional IRA balance will be $0.

 

Please be aware that the recharacterized amount has to be considered that is why you had to enter it as outstanding amount. If you didn't make the mistake that amount would have been in the traditional IRA account and you would have had a balance left in the account that you converted in 2021. 

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