I inherited an IRA & it needs to convert to a Roth. We took a dist that combined the 2024 max & applied a "catch up" dist to the 2023 max. Program says I owe a penalty.

jhambric · ‎February 23, 2025

How do I account for the catch up distribution in the software? I know a penalty is not appropriate.

SusanY1 · ‎March 1, 2025

Are you a spouse beneficiary of the Inherited IRA? Only a spouse beneficiary can convert an Inherited IRA to a Roth. However, to do that the spouse must first put the Inherited IRA into their own name. A direct conversion from an Inherited IRA is not possible and may be why a penalty is showing.

Where and what type of penalty are you seeing? Also, what codes are in Box 7 of the 1099-R?

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I inherited an IRA & it needs to convert to a Roth. We took a dist that combined the 2024 max & applied a "catch up" dist to the 2023 max. Program says I owe a penalty.