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Retirement tax questions
My answer gives the *only* way that the amount you enter as the amount contributed between January 1 and April 15 can affect your balance due. What you are describing agrees exactly with what my answer describes if I assume that your assertion that you did not make any traditional IRA distributions or Roth conversions in 2018 is incorrect and that you actually have entered a code 1, 2 or 7 Form 1099-R that has the IRA/SEP/SIMPLE box marked. The only purpose TurboTax has for asking the amount contributed between January 1 and April 1 is to be able to populate line 4 of Form 8606. The only reason that the amount on line 4 of Form 8606 would have any effect on your balance due is if you made distributions or Roth conversions from a traditional IRA, reported on lines 7 or 8 of Form 8606, respectively.
TurboTax appears to be treating the contribution as nondeductible due to your modified AGI, filing status and participation in an employer-provided retirement plan for 2018. When you enter the $6,500 traditional IRA contribution and do not indicate that it was contributed between January 1 and April 15, TurboTax is treating the nondeductible contribution as being applicable in the calculation of the taxable amount of the separate IRA distribution or Roth conversion that you've already entered. When you go back and tell TurboTax that the $6,500 was contributed between January 1 and April 15, this basis is no longer applicable in the calculation of the taxable amount of the IRA distribution or Roth conversion, the taxable amount of the IRA distribution or Roth conversion goes back to what it was and the basis that is no longer being applied carries forward, increasing the amount on line 14 of Form 8606.
Examine Form 8606 to see the calculation.
TurboTax appears to be treating the contribution as nondeductible due to your modified AGI, filing status and participation in an employer-provided retirement plan for 2018. When you enter the $6,500 traditional IRA contribution and do not indicate that it was contributed between January 1 and April 15, TurboTax is treating the nondeductible contribution as being applicable in the calculation of the taxable amount of the separate IRA distribution or Roth conversion that you've already entered. When you go back and tell TurboTax that the $6,500 was contributed between January 1 and April 15, this basis is no longer applicable in the calculation of the taxable amount of the IRA distribution or Roth conversion, the taxable amount of the IRA distribution or Roth conversion goes back to what it was and the basis that is no longer being applied carries forward, increasing the amount on line 14 of Form 8606.
Examine Form 8606 to see the calculation.
‎June 4, 2019
5:13 PM
1,405 Views