Hi. In March 2020, I had zero traditional IRA or SEP or Simple IRA. I made a non-deductible contribution for 2019 ($7K) and immediately converted it. Thus, it was the full amount of my IRA holdings and should not have any tax effect. That was all related to pre-2020 amounts. Later in the year, I started a Simple IRA and rolled an ex-employer 403(b) into the traditional IRA. When I enter the year-end traditional plus Simple IRA total value into TurboTax, it taxes my conversion. Because the year-end IRA amounts are pre-tax, it seems to be using that value to calculate the percentage of the conversion that should be taxable. Is this correct? When I did the conversion, there was no pre-tax IRA amounts, so it should not have been taxed. I would have thought the conversion "cleared out" the 2019 amounts and that the new 2020 contributions should be irrelevant. Or, does it all depend on the year-end value? (in which case I screwed myself by rolling the 403(b) last year instead of waiting until this year (or by converting, which I wouldn't have done had I known.)) Thanks in advance.
-- John R.