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Retirement tax questions
Yes, you have the option to make the 2021 traditional IRA nondeductible on the “Choose Not to Deduct IRA Contributions” screen choose “Yes, make part of my IRA contribution nondeductible” and enter the amount $6,000 (step 11 of the contribution instructions above). Please be aware, if you have a retirement plan at work and are over the income limit it will be nondeductible automatically and you only get a screen saying $0 is deductible.
For the $3,880 basis (this is only the contribution and doesn't include earnings, correct?) you will enter it in step 11 and 12 of the conversion instructions above.
Yes, only the earnings will be taxable. You can check Form 1040 line 4 b how much was taxable of your conversion. Please be aware, if your traditional IRA wasn't empty before making the nondeductible contributions and had other deductible funds then this will not be true since each distribution/conversion from the traditional IRA will be pro-rated (have a part of the nondeductible basis included).
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