This does NOT work...and its clear as mud.
Didn't mention anything as to what it really takes, which is getting past the Nondeductible, Deductible contributions (which has nothing to do with a REPAYMENT on a 60-Day Rollover - INDIRECT ROLLOVER to a ROTH IRA). Between the IRS, the Bank issuing 1099-R on the same money they distributed month priors when transferring to the ROTH, thats just not cool. I didn't get a check - never saw the money again, and then no 5498 or anything to show the DEPOSIT to the ROTH IRA. Its truly a nightmare - don't ever do this at the end of a year and have the 60days roll into the next year, because this is so messed up - then cutover not until April. It couldn't be more convoluted if they tried. SO, I had to LIE and show the deposit back into the TRAD IRA in under 8606 amount (which karma didn't even generate off the 1099-R Distribution/Code 7 last year - all was taxed it all UP FRONT 1040 line 4b. Nothing ever asks that simple question - how much is on your prior year 1040 4b?
How about this: Did you pay the TAX on this Distribution? Yes or No. If so WHEN? With regards to ROTH IRA conversion it's supposed to be paid in the same QTR, nothing ever asks that at all.
It's a total MESS. Shouldn't have to pay $150 to get this to work. Rep said, just don't enter it! Lol. 1099-R's are reported to IRS. Spent hours and hours reading and researching when it should be straight forward. Out/back In/Out to ROTH. When first 1099-R shows the Full Distribution Amount Code-7, there really shouldn't be another 1099-R at all. Fighting with Empower on that...calling it Indirect, but kicking this out messes everything up. Producing a 2nd 1099-R for the Transfer makes it appear that they Distributed more money than ever had - and Code 7 is taxing the 1/3 I rolled over TWICE.
