How do I make sure TurboTax is not counting non-taxable IRA and Roth IRA related rollovers and conversions as taxable income?

bowledw · Jun 4, 2019 3:23:13 PM

I have a company-sponsored 401k program that allows me to make contributions on a post-tax basis. In 2018 I took some of these post-tax contributions and rolled them over into a Traditional IRA. After that, the Traditional IRA was converted into a Roth IRA. I've uploaded both of my Form 1099-R's related to both transactions to TurboTax, but at the moment, TurboTax wants to treat the IRA to Roth IRA conversion as federally and state taxable income (which it's not). How do I fix this or otherwise force TurboTax to treat this activity as rollover/conversion activity and not a taxable distribution?

To ensure you do the Roth IRA backdoor conversion and the contribution doesn't get marked as taxable income, I had to follow the instructions from this link:

"2. Inside TurboTax, search for ira contributions and select the Jump to link in the search results"

Only once I had followed the rest of the instructions and selected Yes, make part of my IRA contribution nondeductible and THEN returned to the 1099R upload section was I able to ensure that the Backdoor Roth IRA conversion was not counting as taxable income.

To confirm you've done everything correctly:
1) left hand side, go to tax tools -> tools

2) click view tax summary

3) left hand side -> preview my 1040

4) Section: "Form 1040 or Form 1040-SR, Lines 1 - 7" - line 4b should show you a taxable amount of 0.

I'm honestly amazed and how unintuitive TurboTax is. Hopefully this saves another person the 3 hours of wasted time that I lost.