Roth conversion, wrong year reported

[chreechree]

In 2019, we realized we were going to unexpectedly exceed the income limits to contribute to a Roth. My husband and I had been making monthly contributions to our respective Roths, so we stopped contributing. In February 2020, we recharacterized our 2019 contributions into traditional IRAs and then converted them back to Roths. Then, in separate transactions, we went did lump sum contributions to traditional IRAs and then converted them to Roth for a backdoor Roth for 2020. At the time, the Vanguard rep told us to enter the 2019 money manually on the tax return but said they wouldn't give us forms. Now Vanguard reported all of that conversion money for 2020 instead of only the 2020 portion. How do we best fix this? Thank you!

[dmertz]

If you somehow reported the Roth conversion on your 2019 tax return despite not having any 2019 Form 1099-R that reported the distribution from the traditional IRA, amend your 2019 tax return to remove that.  Also make sure that your 2019 Form 8606 shows on lines 1 and 14 the nondeductible traditional IRA contribution that resulted from the recharacterization.

Report the Roth conversion that was performed in 2020 on your 2020 tax return where it belongs by entering the 2020 Form 1099-R that reports the distribution from the traditional IRA.  Also make sure that line 2 of your 2020 Form 8606 shows the basis that carried forward from line 14 of your 2019 Form 8606.  To reach the page that asks you to enter or confirm the basis that carried forward, click the Continue button on the page that lists the 1099-Rs that you've entered.

[MarilynG1]

If you reported the recharacterization in 2019 when you entered your Roth contribution, you would report the conversion in 2020.

You would have two 1099-R's for 2020. 

Click this link for detailed info on Recharacterization/Conversion if this applies to you.