Filing an amended return due to mistake regarding Roth IRA contribution

[mt56]

This is a follow on from my original post , but it took me a while to respond so think it fell off the radar.

https://ttlc.intuit.com/community/retirement/discussion/re-what-are-the-correct-steps-to-amend-my-re...

To summarize: I suspected we made a mistake when filing our 2023 return as it relates to backdooring our traditional into a Roth IRA, and when I went to try and file an amended return for 2023 I don’t believe the issue was corrected: the full distribution amount from 4a was in 4b, which I believe should have been blank (there were no earning before backdooring). The advice I received was to file a Form 8606 showing a non-deductible contribution unless I took a deduction for the traditional IRA contribution which would offset the tax. I wanted to confirm that we did not take a deduction, so I reviewed my 2023 return on TurboTax and there was no Schedule 1 included, so I believe we did not take a deduction. We’ve also never had a balance in either of our Traditional IRAs. I just want to confirm that I’ve reviewed all the correct steps and now should fill our the Form 8606?

[dmertz]

If you made a traditional IRA contribution for 2023 and it does not appear either as a deductible contribution on 2023 Schedule 1 or as a nondeductible contribution on 2023 Form 8606, you have failed to enter the traditional IRA contribution into TurboTax.

[mt56]

We backdoored a Roth IRA contribution, so it shouldn't show as a traditional contribution, right?

[dmertz]

That's incorrect.  You performed two separate transactions, a traditional IRA contribution followed by a Roth conversion.  Both of these separate transactions must be entered.  There was no ordinary Roth IRA contribution, so under Deductions & Credits no Roth IRA contribution is to be entered, only a traditional IRA contribution.

[mt56]

Ok - but given my situation line 4b on my 1040 should still be blank (no gains before the backdoor), correct?

[dmertz]

Assuming that you have no other IRA accounts and that the traditional IRA contribution for 2023 that you enter into 2023 TurboTax was nondeductible, TurboTax will prepare 2023 Form 8606 showing the nondeductible contribution on line 1.  TurboTax will then apply that basis to the Roth conversion performed in 2023, resulting in $0 of taxable income shown on line 18.  The amount on line 18 gets included on Form 1040 line 4b, so with the amount on line 18 of Form 8606 being zero, nothing is added to line 4b.  If no Form 8606 is present, you have failed to enter a nondeductible traditional IRA contribution.