dmertz
Level 15

Retirement tax questions

There appears to be nothing that needs fixing.  Apparently your husband is covered by a workplace retirement plan, you are not, and you MAGI for the purpose of deducting a traditional IRA contribution is above the threshold where your husband is ineligible to deduct the contribution but below the threshold where your own contribution remains deductible.  This means that your husband has basis in nondeductible traditional IRA contributions that reduces the taxable amount of his Roth conversion but your traditional IRA contribution is being deducted on Schedule 1, giving you no basis to apply to your Roth conversion.  If you had no funds in traditional IRAs at year end, you could tell TurboTax to make your contribution nondeductible, but the taxable result would be the same.  You wouldn't get the deduction for the traditional IRA contribution, but your Roth conversion wouldn't be taxable, so your AGI would remain the same.

 

One thing to consider, though.  If your MAGI is low enough for your traditional IRA contribution to be able to be deducted, your MAGI for the purpose of making a Roth IRA contribution should also be low enough to be eligible to contribute directly to a Roth IRA, although contributing directly to the Roth IRA it might not make any difference.