In February 2021, I contributed to a traditional IRA and then immediately funded a Roth IRA to do a backdoor conversion for calendar year 2020. I completed two on the same day: one for calendar year 2020 and one for calendar year 2021. So I contributed to 2020 tax year and 2021 tax year in 2021, but converted both years in 2021. The calendar year 2021 contribution and conversion I will handle in my 2021 return, but would like to get additional clarity on how to handle the 2020 transaction contributed and converted in 2021.
It is my understanding that there is nothing I need to do for the conversion related to the 2020 contribution that occurred in calendar 2021. I did not receive a 1099-R so there is nothing to report for income (though there should not be any since i immediately converted), and will handle this part with my 2021 return. But I am trying to figure out all of the boxes in 2020 to select for the contribution for 2020:
- Select Traditional IRA
- Confirm on next screen I contributed to a traditional IRA - YES
- Is this a repayment - NO
- Enter total 2020 contributions. Enter same amount in portion funded between Jan. '21 and Apr. '21 (two fields to populate)
- Did you change your mind - NO
- Any excess IRA contributions before 2020 - NO (these are my first two IRA transactions)
- "Any non-deductible Contributions to your IRA? Let us know if you made and kept track of any non-deductible contributions to your traditional IRA from 2019 or prior years."
Step 7 is what is confusing me. Is the question about my 2020 IRA contribution? If so, is the answer is yes since I am making a backdoor that is non-deductible. Or - is the question about non-deductible contributions in 2019 and prior? If so, is the answer is no since my first IRA transactions are in 2020.
Depending on how this question is answered, the screens/questions that follow are different, so I wan to be sure I select the right answer.
I am using TT Home and Business for tax year 2020. Thank you for your help.
