@macuser_22 Thanks for reading my post and for your input!
I have 2 1099-Rs, one for my T IRA and one for R IRA.
Since recharacterization and conversion was done before 2019 was over, I already received them.
Roth IRA 1099-R:
Box 1: $3286
Box 2a: $0
Box 2b: nothing checked
Box 7: "N"
IRA/SEP/SIMPLE: box NOT checked
Traditional IRA 1099-R:
Box 1:$6286
Box 2a: $6286
Box 2b: Taxable amount not determined and total distribution both checked
Box 7: "2"
IRA/SEP/SIMPLE: box checked
I really want to do this right so please bear with me as I explain the steps I am thinking of taking to record this properly:
First, to enter the recharacterization/contribution:
1. Go to Deductions&Credits
2. Traditional and Roth IRA Contributions
3. I check only Traditional IRA (since I had contributed $3000 first into Roth IRA directly which was then recharacterized to Traditional IRA along with taxable gains, then I had added $3000 more into Traditional IRA then converted whole thing over for backdoor full Roth contribution for 2019)
4. "Is this a repayment of a retirement distribution?" No
5. "Tell us how much you contributed" Total 2019 traditional IRA contribution 6000 (gains are supposed to be left out here, right?), nothing contributed between January 1, 2020 and April 15, 2020 since all this was done in 2019.
6. "Tell us how much you transferred" 0, since this is asking whether or not I "recharacterized" any of my traditional IRA contributions to Roth IRA, which doesn't apply for me since I am "converting" the full amount.
7. "Any Excess IRA contributions before 2019?" No
8. "Any nondeductible contributions to William's IRA?" Yes, since all 6000 I contributed to traditional IRA Is non deductible as I will be converting to Roth
9. "Let's fine your IRA basis" I actually have $1000 on line 14 on 2018 Form 8606 because I had recharacterized $1000 in 2018 as well due to similar problem...
10. "Tell us the value of all your traditional IRA accounts" 0, since the conversion was complete before December 31, 2019 and at that time the account was already empty.
11. "Choose not to deduct IRA contributions" I select "Yes, make part of William's IRA contribution non deductible" and I put whole 6000 since all of it will be converted to Roth.
12. "Your IRA deduction summary" $0
To enter the conversion:
1. Go to Income/Expenses
2. Select IRA, 401k, Pension Plan WIthdrawls (1099-R)
3. Just to confirm, am I supposed to enter both 1099-R for my Roth IRA and Traditional IRA? I was under the impression only Traditional IRA 1099-R needs to be entered.. is that right?
In that case, I have 2 1099-R's to enter. I have 1099-R for recharacterization and conversion of $1000 that was done in 2/2019 for 2018 tax year (I was late on conversion for this year), and another 1099-R for Tax year 2019's conversion which was done before 2019 was over.
4. I put in Traditional IRA 1099-R data, it tells me "Good News, you don't owe extra tax on this money" which makes sense since I didn't take deduction on it.
5. "Did XXX inherit the IRA from XXX brokerage?" No
6. "What did you do with the money from XXX brokerage?" I choose "I moved the money to another retirement account" and "I converted all of this money to Roth IRA account"
I apologize for the long text, I just want to make sure I am doing things correctly. I really appreciate your help! @macuser_22
