Help with traditional IRA taxable amount

[17958353p]

Hi there,

Doing 2019 taxes now (married, filed jointly). In 2019, my wife and I both did backdoor Roth IRAs by contributing $6,000 to a traditional IRA and converting it to Roth. Both of us had a $0 cost basis at the end of 2019.

I've imported the 1099R forms (Merrill and Schwab) and gone through the correct steps to make sure that it is properly characterized as a conversion (essentially these steps: https://thefinancebuff.com/how-to-report-backdoor-roth-in-turbotax.html)

However, when I am ready to finish up the income portion, Turbotax is reporting:

IRA Distributions - taxable: $500

IRA Distributions - nontaxable: $11,500

I know this is the result of my wife's traditional IRA (if I delete it, the numbers are $0 taxable/$6,000 nontaxable) but I do not know what I am filling out incorrectly here. Why is there $500 of taxable IRA distributions? Shouldn't it be $0?

Thanks in advance.

[17958353p]

I think I found where it is messing up but unclear why it is doing so.

On the screen to find your IRA basis, I am entering $5,500 for my wife's basis, entered in the Form 8606. If I change it to $6,000, then the tax amount is correct, but then the form would be incorrect.

For some reason, Turbotax thinks the increase of $500 in the max contribution amount is a gain. Not sure what is going on here.

[macuser_22]

When what the spouses $6,000 non-deductible contribution made - what year for what year?

Was the Dec 31, 2019  value of all of the spouse IRA's zero (that it the aggregate total value of any Traditional, SEP or SIMPLE IRA that existed at years end).

Go to the forms mode and view the 8606-S (spouse) form.  What is on line 1,2,4,6  and 15c?

[17958353p]

I made the deposit of $6,000 on 1/8/19 for the 2019 tax year.

1: $0

2: $5,500

4: $0

6: $0

15c: $0

Should 1 actually be $6,000?

For reference, the values for the 8606-T are:

1: $6,000

2: $5,500

3: $11,500

4: $0

6: $0

15c: $0

[macuser_22]

If your spouses 2019 $6,000 non- deductible contribution is not on the 8606-S line 1, the  either it was not entered, or it was not marked non-deductible.   Is it on Schedule 1 line 19 as a deductible  contribution instead?