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Level 1
posted Feb 19, 2022 9:58:17 AM

roth IRA conversion (what should I put for outstanding recharacterization amount in turbotax)

I made 6000$ nondeductible Traditional IRA contribution for 2021 at Feb 2021, and converted to Roth immediately at the same month. The initial value of my Traditional IRA was 0. Now I am filling out turbotax, in the tab "Tell Us the value of your traditional IRA", what should I put for outstanding recharacterization? Should it be 0 or 6000? Thanks!

0 5 1203
5 Replies
Level 15
Feb 19, 2022 1:55:46 PM

$0.

 

You did no recharacterization, you did a Roth conversion.

Level 1
Feb 20, 2022 9:06:02 AM

Thanks dmertz, one more follow up question, If I contribute nondeductible money to traditional IRA and convert to roth each year, my IRA basis  (line 2 from form 8606) should be increasing each year right? For example: this year my basis is 12000$, and I contributed 6000$ after tax money, so the following year, my basis should be 18000$ right?

Level 15
Feb 20, 2022 10:32:07 AM

No, line 2 will be zero every year.  Line 2 of a Form 8606 comes from line 14 of the previously filed Form 8606 which will be zero because the Roth conversion consumes the basis.

Level 15
Feb 20, 2022 10:38:10 AM
Level 1
Feb 20, 2022 12:08:30 PM

Got it, thanks!