Get your taxes done using TurboTax

Can you please provide more information?  You contributed $6,000 for 2021 and received a Form 1099-R of $7,000 for a conversion (moving money from traditional IRA to Roth IRA)? You entered that you contributed $6,000 for 2021? 

Did you make a nondeductible contribution for 2020 in 2020 that you converted in 2021? It seems as if you had a $1,000 direct contribution for 2020 (shown on Form 5498). If yes, then you should have a basis (nondeductible contribution) on your 2020 tax return Form 8606 line 14 to carry over to 2021. You need to enter this basis when TurboTax asks for the prior year basis during the interview. If you didn't enter the contribution on your 2020 tax return then please see How do I amend my 2020 return?

 Why are you withdrawing $1,000 as an excess contribution? You are allowed to make a $6,000 contribution for 2021.

Please do not create two Form 1099-Rs when you received only one Form 1099-R. Please enter it as shown.

Please review the entry steps below.

To enter the nondeductible contribution to the traditional IRA:

1. Login to your TurboTax Account 
2. Click on "Search" on the top right and type “IRA contributions” 
3. Click on “Jump to IRA contributions"
4. Select “traditional IRA”
5. Answer “No” to “Is This a Repayment of a Retirement Distribution?”
6. Enter the amount you contributed
7. Answer “No” to the recharacterized question on the “Did You Change Your Mind?” screen
8. Answer the next questions until you get to “Any Nondeductible Contributions to Your IRA?” and select “Yes” if you had a nondeductible contribution before this tax year.
9. If you had a basis in the Traditional IRA before then enter the amount.
10. On the “Choose Not to Deduct IRA Contributions” screen choose “Yes, make part of my IRA contribution nondeductible” and enter the amount (if you have a retirement plan at work and are over the income limit it will be nondeductible automatically and you only get a warning and then a screen saying $0 is deductible).

To enter the 1099-R distribution/conversion: 

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. On the "Your 1099-R Entries" screen click "continue"
6. Answer "yes" to "Any nondeductible Contributions to your IRA?" if you had any nondeductible contributions in prior years.
7. Answer the questions about the basis from line 14 of your 2020 Form 8606 and the value of all traditional, SEP, and SIMPLE IRAs

@jred81

@Spouse1234 Yes, you need to keep the IRA/SIMPLE/SEP box checked for a distribution/conversion from a traditional IRA.