@dmertz
thanks for the info. Yes it was a nondeductible contribution (recharacterized). My intention of doing clean backdoor Roth’s obviously didn’t work as intended. For 2021I had a cash amount ($500) at the end of the year and recharacterized amounts ($1000) in 2021 for year 2020. So essentially even though my balance in my traditional at end of year 2022 is $0, and I have converted all dollars in the traditional to Roth (including all recharacterizations 2020-2021) up to year 2022, I would still end up having some sort of basis on line 14 of 2021?
How do I get my basis back to $0 if I have nothing in my traditional? I think this is where I’m confused. Also, would I be paying taxes on only the earnings of my outstanding recharacterizations? Is the IRS interpreting my recharacterizations as a balance in my IRA as to produce a non-clean backdoor Roth, hence taxing some of these recjaracterizations?
