@dsyhome0510 wrote:
Macuser_22:
thank you for detailed answer.
now I understand the 14k (7k for 2020, 7k for 2021)backdoor roth IRA conversions are taxable due to large traditional IRA balance end 2021.
to reduce the "double" tax of these nondeductible IRA funds can I undo the roth conversion by recharacterization? Probably there is no way to correct 2020 conversion, but by undoing 2021 conversion at least I can reduce some loss...
please advise correct procedures to do so in Turbo Tax Deluxe, thanks
There is no "double tax". A conversion is taxable just like any other Traditional IRA distribution is since the majority of the money was not taxed when it was put in so it is taxed when you take it out.
And sorry, but after 2018 IRA conversions can no longer be recharactorized or undone.
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
