When performing a “backdoor Roth conversion“, all of your IRA balances are aggregated together. If you don’t convert the entire amount, then you keep a taxable basis in your traditional IRA. You can’t selectively convert specific dollars.
For example, suppose you have $6000 in IRA number 1. You make a nondeductible contribution of $6000 to IRA number 2, and then convert it to a Roth IRA. Under that circumstance, your IRA balances are aggregated together. You have a $12,000 IRA balance of which you are converting $6000 or 50%. That means that 50% of the conversion is treated as a taxable event (because you are converting part of the pretax IRA) and 50% is nontaxable, and you are left with a $6000 IRA that has a $3000 nondeductible basis in it.
The back door, Roth only works if you have no other IRA balances, or you convert your entire IRA balance at the same time.
without knowing the exact numbers of each transaction, we can’t tell you if TurboTax is calculating it correctly. But you can’t make a back door Roth conversion and have it work the way you want it to if you have another IRA balance at the same time.
