Backdoor Roth IRA conversion not working

[wey2camp]

Hi,

I'm following the following instructions to do a backdoor roth.

https://ttlc.intuit.com/turbotax-support/en-us/help-article/retirement-benefits/enter-backdoor-roth-...

However, when I get to step 2.6 I enter that it was a roth conversion and in 2.7 I enter that it was all converted to roth the system is still showing a taxable amount on line 4b in the 1040. 

Would someone be able to help look at this?

My token # is 1090622

[MaryK4]

You have to continue past the 1099-R summary page and "Did you take any disaster distributions before 2022?"  The next page says Any Nondeductible Contributions?"  When you enter the nondeductible contributions, the amount will become nontaxable and TurboTax will create the forms needed for the return.

[wey2camp]

Thank you for this. It is now showing correctly.

Just to double check. We had a 12,000 withdraw because in 2022 we added money for both 2021 and 2022 backdoor conversions. 

I  can make and track the full 12,000 nondeductible contribution to the IRA in this years taxes?

[DanaB27]

I noticed both Form 1099-Rs are entered as the taxpayer's Form 1099-R. If one Form 1099-R is for your spouse then please make sure to select your spouse  for "This Form 1099-R belongs to"

Please make sure you enter the $6,000 2021 nondeductible contribution ( basis from your 2021 Form 8606 line 14) on the "Let's find your IRA basis" screen, as Tax Expert MaryK4 mentioned above. Also, make sure you enter the value of all of your traditional/SEP/Simple IRAs on December 31, 2022, and repeat these steps for your spouse). If you converted the full amount and didn't have any other IRAs then this should be $0.

Please review the steps below for additional information.

To enter the nondeductible contribution to the traditional IRA:

1. Login to your TurboTax Account 
2. Click on "Search" on the top right and type “IRA contributions” 
3. Click on “Jump to IRA contributions"
4. Select “traditional IRA”
5. Answer “No” to “Is This a Repayment of a Retirement Distribution?”
6. Enter the amount you contributed
7. Answer “No” to the recharacterized question on the “Did You Change Your Mind?” screen
8. Answer the next questions until you get to “Any Nondeductible Contributions to Your IRA?” and select “Yes” if you had a nondeductible contribution before this tax year.
9. Enter your basis in the Traditional IRA from your 2021 Form 8606 line 14 (if you had a basis in the prior year)
10. On the “Choose Not to Deduct IRA Contributions” screen choose “Yes, make part of my IRA contribution nondeductible” and enter the amount (if you have a retirement plan at work and are over the income limit it will be nondeductible automatically and you only get a warning and then a screen saying $0 is deductible).

To enter the 1099-R conversion: 

1. Click on "Search" on the top right and type “1099-R”  
2. Click on “Jump to 1099-R”
3. Click "Continue" and enter the information from your 1099-R
4. Answer questions until you get to “Tell us if you moved the money through a rollover or conversion” and choose “I converted some or all of it to a Roth IRA”
5. On the "Review your 1099-R info" screen click "Continue"
6. Answer "yes" to "Any nondeductible Contributions to your IRA?" if you had any nondeductible contributions in prior years.
7. Answer the questions about the basis from line 14 of your 2021 Form 8606 and the value of all traditional, SEP, and SIMPLE IRAs

@wey2camp 

[khaitran24]

This does work for me. I followed all instructions here but it stills report the 1099-R number on box 4b of my 1040.

Looks like the TurboTax software has bug on this? So annoying, it usually worked fine for me in previous years, but this year, could not figure out how to make TurboTax online remove box 4b. Looks like the software has a bug?

Anyway I can manually edit box 4b on 1040 form directly?

[DanaB27]

To clarify, was your value $0 on December 31, 2024? If not then the pro-rata rule applies. This means that with each distribution/ conversion you will have a taxable and nontaxable part. You can check Form 8606 to see the how the taxable amount is calculated. 

No, you shouldn't edit the entry in box 4b. 

Please review How do I enter a backdoor Roth IRA conversion?

If you are still having issues then please provide more details when you made the contribution and the conversion.

Also, you can send us a “diagnostic” file that has your “numbers” but not your personal information. If you would like to do this, here are the instructions for TurboTax Online: 

1. From the left menu select Tax Tools. 
2. Then select Tools below Tax Tools. 
3. A window will pop up which says Tools Center.  
4. On this screen, select Share my file with Agent. 
5. You will see a message explaining what the diagnostic copy is. Click okay through this screen and then you will get a Token number. 
6. Reply to this thread with your Token number and add @DanaB27 . This will allow us to open a copy of your return without seeing any personal information.  

The instructions for TurboTax Download: 

1. On your menu bar at the very top, click "Online"
2. Select "Send Tax File to Agent"  
3. Click "Send"
4. The pop-up will have a token number
5. Reply to this thread with your Token number and add @DanaB27 . This will allow us to open a copy of your return without seeing any personal information.  

We will then be able to see exactly what you are seeing and we can determine what exactly is going on in your return and provide you with a resolution.

@khaitran24