No, do not report a portion of a Traditional IRA amount that was used for a Roth IRA and it occurred in the same tax year.
Any money that went into a traditional IRA or SEP IRA and then transferred to a Roth in the same year does not provide a deduction. With a conversion to a Roth IRA, you have to pay tax on the traditional IRA account funds getting moved to the Roth account.
If you recharacterize your IRA contribution properly and before your tax return due date (including extensions), the tax effect is as though the contribution to the first IRA never happened.
Any money moved/converted from the Traditional IRA or SEP IRA that was contributed in an earlier year will be taxable when moved to the Roth.
Summary:
- A conversion allows you to transfer funds from a non-Roth IRA account into a Roth IRA account, often with a taxable impact.
- IRA recharacterization rules allow you to change your mind about your IRA contribution account type, if done within current tax year deadlines.
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