DanaB27
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Get your taxes done using TurboTax

Yes, you will have to report the contribution for 2020 on your 2020 tax return. Please see How do I amend my 2020 return? If the contribution is nondeductible then TurboTax will create Form 8606 with a basis on line 14 to carry over to 2021 (enter in steps 8 and 9 when you enter your 2021 contribution on your 2021 tax return)..

 

If you contributed $6,000 for 2020 then your basis on line 14  on your 2020 Form 8606 would be $6,000.

 

Yes, you will use the value from your year-end statement. If you only had one traditional IRA and converted all in 2021 then your value would be $0 on December 31, 2021.

 

 

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” since you had a nondeductible contribution before this tax year.
  9. Enter your $6,000 basis in the Traditional IRA from your 2020 Form 8606 line 14.
  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 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 "Review your 1099-R info" 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


 

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