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New Member
posted Jun 20, 2022 7:14:04 AM

Should I have been charged a 6% tax on a backdoor Roth conversion? We do it every year, and 2021 was the first time this has happened?

I am wondering if this is an error in the 2021 software.  There was no form 8606 (non-deductible IRA contributions) triggered in 2021, but instead there was a form 5329 (additional taxes).  

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1 Replies
Level 15
Jun 20, 2022 7:51:05 AM

There is no problem with the software.  You either mistakenly reported a Roth IRA contribution instead of a traditional IRA contribution or the traditional IRA contribution that you reported was itself an excess contribution due to having insufficient compensation to support the contribution.

 

Which part of Form 5329 shows the excess contribution and calculation of the penalty?  The answer will indicate which of these mistakes you made.