When can I use Code C for Roth Conversion? (Current year conversion from IRA to Roth IRA) You can subtract current year conversion from a traditional IRA to a Roth IRA

[msmoldy]

My Michigan Tax Return refunds the Tax I paid if I choose Code C for a Trad to Roth Conversion. Does this make sense?

[dmertz]

"When can I use Code C for Roth Conversion?"

Never.  IRAs are not permitted to hold life insurance contracts as investments.

[msmoldy]

Thank you; that makes sense.
I think the wording was confusing me for choices.  

[dmertz]

You use whatever code is in box 7 of the Form 1099-R, code J, T or Q for a regular Roth IRA distribution.

[msmoldy]

The code in box 7 of my 1099R  is a 7. 
on other codes. 
I’m over 59 1/2 

What confuses me is the next TurboTax screen asking:

Where is your distribution from for Michigan information? 

M - Military Pension

G - Qualified Government or SS

C - Current year conversion from a traditional IRA to a Roth IRA

P - other qualified IRA distributions 

N - Pension/IRA distribution received before retirement age/ None of the above  

if I choose N; State of MI taxes my Conversion; 

if I chose C; State of MI doesn’t tax it. 

[dmertz]

Sorry, my previous reply referred to distributions from a Roth IRA, not from a traditional IRA.

Also, I had assumed that you were referring to the code in box 7 of the Form 1099-R.  I know nothing about Michigan codes, so disregard everything that I have said previously in reply to your question.  You might consider asking the question again in a new thread so that it shows up as unanswered.

Still, it looks like Michigan code C would apply to your Roth conversion.  I suggest looking at page 19 of the instructions for Form MI-1040:

https://www.michigan.gov/taxes/-/media/Project/Websites/taxes/Forms/IIT/TY2024/MI-1040-Instructions....

[msmoldy]

Thank you dmertz for the clarification and the direction to find my answer.