Get your taxes done using TurboTax

Issue 1: You stated that you made a nondeductible traditional IRA contribution for 2020 in 2021. Please make sure you had entered this on your 2020 tax return with these steps:

1. Click on "Search" on the top right and type “IRA contributions”
2. Click on “Jump to IRA contributions"
3. Select “traditional IRA”
4. Answer “No” to “Is This a Repayment of a Retirement Distribution?”
5. Enter the amount you contributed
6. Answer “No” to the recharacterized question on the “Did You Change Your Mind?” screen
7. On the “Choose Not to Deduct IRA Contributions” screen choose “Yes, make part of my IRA contribution nondeductible” and enter the amount (if your income is too high and you have a retirement plan at work then this question won't come up and TurboTax will make it automatically nondeductible). 

Issue 2:

You will enter the contributions for you and your spouse as above on your 2021 tax return.

Please follow these steps to enter the conversion (1099-R), please pay special attention to steps 7-9:

1. Click on "Search" on the top right and type “1099-R”
2. Click on “Jump to 1099-R”
3. Click "Continue" and enter the information from your 1099-R
4. Answer questions until you get to “Tell us if you moved the money through a rollover or conversion” and choose “I converted some or all of it to a Roth IRA”
5. Add your spouse's 1099-R and repeat step 4.
6. On the "Your 1099-R Entries" screen click "continue"
7. Answer "yes" to "Any nondeductible Contributions to your IRA?" since you had any nondeductible contributions in prior years.
8. Answer the questions about the basis and value
9. Answer "no" to "Any nondeductible Contributions to your IRA?" for your spouse since your spouse did not have any nondeductible contributions left in the IRA from prior years.

If entered correctly then only earnings would be taxable on line 4b of Form 1040:

1. Click on "Tax Tools" in the left menu
2. Click "Tools"
3. Click "View Tax Summary" in the Tool Center window
4. Click on "Preview my 1040" on the left