Retirement tax questions

Please make sure that you reported the 2019 recharacterization correctly and made it nondeductible. If not then please see How do I amend my 2019 return?.

2019 tax return enter the traditional IRA contribution and recharacterization of the Roth 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" and  “Roth IRA”
5. Answer “No” to “Is This a Repayment of a Retirement Distribution
6. Enter the traditional IRA contribution amount of $4,000
7. Roth IRA question: Answer “No” to the recharacterized question on the “Did You Change Your Mind?” screen
8. Answer “No” to “Is This a Repayment of a Retirement Distribution
9. Enter the Roth contribution amount  of $2,000
10. Answer “Yes” to the recharacterized question on the “Did You Change Your Mind?” screen and enter the $2,000 contribution amount (no earnings or losses)
11. TurboTax will ask for an explanation statement where it should be stated that the original $xxx.xx plus $xxx.xx earnings (or loss) were recharacterized.
12. On the screen "Choose Not to Deduct IRA Contributions" answer "Yes" (if you are thinking about doing a backdoor Roth. If you have a retirement plan at work and are over the income limit it will be nondeductible and you only get a screen saying $0 is deductible)

A 2020 1099-R with code R belongs on your 2019 return but will not do anything on your return. But you can ignore the 1099-R with code R for the recharacterization since you can only enter the recharacterization as mentioned above.

On your 2020 tax return:

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 contributions before this tax year.
9. Enter the $6,000 basis amount
10. On the “Choose Not to Deduct IRA Contributions” screen choose “Yes, make part of my IRA contribution nondeductible” and enter the amount.
11.  

To enter the $14,000 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 "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 and value

Yes, only the $2,000 gain should show on line 4b as taxable amount if entered correctly.