I contributed $5500 to a Roth IRA in 2016. After
a ETF transaction, which earned $83, I realized that I should do a backdoor
Roth. I recharacterized the $5583 to a new traditional IRA account, then converted
it back to Roth IRA. They all were done in 10 days. Now I received two 1099-R
forms. Form one with Box1 $5583, Box2a $5583, Box7 02. Form two with Box1 $5583,
Box2a 0, Box7 N.
In Desktop version of TurboTax, Federal
Taxes > Deductions & Credits > I'll Choose What to Work On >
Retirement and Investments > Traditional and Roth IRA Contributions, should
I input $5500 contribution to Roth IRA and conversion $5583 to traditional IRA,
as well as $5583 contribution to traditional IRA and recharacterization to Roth
IRA? Or input only once? Either way, the system will tell me that there’s $83
excess contribution to Roth that I should withdraw and pay the penalty for the
gain. Does that mean I should withdraw $83 to my pocket, or set aside $83 back
to traditional IRA? How to pay the penalty on the gain of that $83 part?
Another problem is when I input these
1099-R forms at Federal Taxes > Wages & Income > I'll Choose What to
Work On > Retirement Plans and Social Security > IRA, 401(k), Pension
Plan Withdrawals (1099-R), the federal refund amount dropped
significantly. I think that’s all about after-tax money and shouldn’t have much
influence on refund amount. Did I do anything wrong?
