Hi, I searched the forum for similar questions and found others had more complex situations than mine.
I recently changed employers and opted into a Traditional IRA. I originally contributed 100% of savings to a Roth IRA with the old employer. I followed the financial institution's process to disburse the funds and moved them into the new Traditional account immediately upon receipt of the distribution check. All Roth funds were put into a Traditional account.
Here is how I reported the situation in TurboTax:
- Provided the 1099-R that was provided by the original financial institution. The document indicated that $0.00 was taxable.
- I then used TurboTax's template for explaining recharacterized funds, and included the amount that was put into the Roth during 2020 with the old employer but then moved into the Traditional IRA with the new employer.
That is it.
The distribution is labeled as income, so I wanted to make sure that these funds were properly being accounted for since it really was not retained cash. My understanding is that since the 1099-R indicated that the money was not taxable, that is enough to help tell the story that the money was properly put back into an IRA.
Is my approach and understanding correct?
Thank you.
