My Traditional IRA cost basis was $0 in 2022. I made a non-deductible contribution in 2023 and converted it to a Roth 5 days later in 2023. My IRA accumulated $1 of interest during that time. The Traditional IRA value was $1 on December 31.
In TurboTax, line 6 is empty and $1 has been added to line 18 (taxable amount).
(Line 17 is the amount converted minus $1)
Is this because the taxes on the conversion are on the total value of the conversion/total value of the IRA?
When I fill out form 8606 manually on a PDF, I get different results:
Line 6 is $1.
Line 8 is the amount converted
Line 9 is the total of line 6 and 8
Line 10 is $1.
Line 11 is the amount converted
Line 13 is the amount converted
Line 16 is the amount converted
Line 17 is the amount converted
Line 18 is 0 (taxable)
In this case, I would assume that the $1 will be taxed when I take a distribution. What am I missing?
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Related question answered here:
Line 10 is slightly less than 1 if you carry enough decimal places.
Related question answered here:
Line 10 is slightly less than 1 if you carry enough decimal places.
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