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Level 3
posted Mar 19, 2023 3:27:38 PM

Roth IRA Order of Entries

Hello, 

 

Do I need to enter the federal deduction part first for a back door roth IRA - then import the 1099 - R.

 

Or can I import my 1099-R data first and then enter the deduction later?  I think I am getting confused because most of the instructions say to enter the deduction first, than do the 1099 - r.  But usually I do this import first so not sure if this is messing things up.  Should I do the deduction first, than go back and import 1099-r?  Not sure if there is other financial information from that institution that would impact other calculations related to the Roth so I usually import that first.

 

Thank you for your patience and help.

0 2 923
1 Best answer
Expert Alumni
Mar 20, 2023 11:02:35 AM

Yes, you can import your Form 1099-R first and then enter the nondeductible contributions. Just ignore the refund meter while you do this because without the nondeductible contributions entered the conversion will show as fully taxable.

 

To enter the 1099-R conversion: 

 

  1. Click "Federal Taxes" on the top and select "Wages & Income"
  2. Click "I'll choose what to work on"
  3. Scroll down and click "Start" next to "IRA, 401(k), Pension Plan (1099-R)" 
  4. Answer "Yes" to the question "Did You Have Any of These Types of Income?"
  5. Click "I'll Type it Myself"
  6. Choose "Form 1099-R, Withdrawal of Money from 401(k) Retirement Plans, Pensions, IRAs, etc."
  7. Click "Continue" and enter the information from your 1099-R
  8. Answer questions until you get to “What Did You Do With The Money” and choose “I moved it to another retirement account”
  9. Then choose “I did a combination of rolling over, converting, or cashing out money.” and enter the amount next to "Amount converted to a Roth IRA account"
  10. On the "Your 1099-R Entries" screen click "continue"
  11. Answer "yes" to "Any nondeductible Contribution to your IRA?" if you had any nondeductible contributions in prior years.
  12. Answer the questions about the basis from line 14 of your 2021 Form 8606 and the value of all traditional, SEP, and SIMPLE IRAs

 

 

To enter the nondeductible contribution to the traditional IRA:

 

  1. Open your return
  2. Click “Deductions &Credits” on the top
  3. Click "I'll choose what to work on"
  4. Scroll down to “Traditional and Roth IRA Contributions” and click “Start”
  5. Select “traditional IRA”
  6. Answer “No” to “Is This a Repayment of a Retirement Distribution?”
  7. Enter the amount you contributed
  8. Answer “No” to the recharacterized question on the “Did You Change Your Mind?” screen
  9. Answer the next questions until you get to “Any Nondeductible Contributions to Your IRA?” and select “Yes” if you had nondeductible contributions before this tax year
  10. Enter your basis in the Traditional IRA from your 2021 Form 8606 line 14 (if you had a basis in the prior year)
  11. On the “Choose Not to Deduct IRA Contributions” screen choose “Yes, make part of my IRA contribution nondeductible” and enter the amount (if you have a retirement plan at work and are over the income limit it will be nondeductible automatically and you only get a warning and then a screen saying $0 is deductible).

 

2 Replies
Expert Alumni
Mar 20, 2023 11:02:35 AM

Yes, you can import your Form 1099-R first and then enter the nondeductible contributions. Just ignore the refund meter while you do this because without the nondeductible contributions entered the conversion will show as fully taxable.

 

To enter the 1099-R conversion: 

 

  1. Click "Federal Taxes" on the top and select "Wages & Income"
  2. Click "I'll choose what to work on"
  3. Scroll down and click "Start" next to "IRA, 401(k), Pension Plan (1099-R)" 
  4. Answer "Yes" to the question "Did You Have Any of These Types of Income?"
  5. Click "I'll Type it Myself"
  6. Choose "Form 1099-R, Withdrawal of Money from 401(k) Retirement Plans, Pensions, IRAs, etc."
  7. Click "Continue" and enter the information from your 1099-R
  8. Answer questions until you get to “What Did You Do With The Money” and choose “I moved it to another retirement account”
  9. Then choose “I did a combination of rolling over, converting, or cashing out money.” and enter the amount next to "Amount converted to a Roth IRA account"
  10. On the "Your 1099-R Entries" screen click "continue"
  11. Answer "yes" to "Any nondeductible Contribution to your IRA?" if you had any nondeductible contributions in prior years.
  12. Answer the questions about the basis from line 14 of your 2021 Form 8606 and the value of all traditional, SEP, and SIMPLE IRAs

 

 

To enter the nondeductible contribution to the traditional IRA:

 

  1. Open your return
  2. Click “Deductions &Credits” on the top
  3. Click "I'll choose what to work on"
  4. Scroll down to “Traditional and Roth IRA Contributions” and click “Start”
  5. Select “traditional IRA”
  6. Answer “No” to “Is This a Repayment of a Retirement Distribution?”
  7. Enter the amount you contributed
  8. Answer “No” to the recharacterized question on the “Did You Change Your Mind?” screen
  9. Answer the next questions until you get to “Any Nondeductible Contributions to Your IRA?” and select “Yes” if you had nondeductible contributions before this tax year
  10. Enter your basis in the Traditional IRA from your 2021 Form 8606 line 14 (if you had a basis in the prior year)
  11. On the “Choose Not to Deduct IRA Contributions” screen choose “Yes, make part of my IRA contribution nondeductible” and enter the amount (if you have a retirement plan at work and are over the income limit it will be nondeductible automatically and you only get a warning and then a screen saying $0 is deductible).

 

Level 15
Mar 20, 2023 12:50:22 PM

The order of entry does not matter.  TurboTax recalculates with each entry.