Started Trad IRA in 2024 with post tax cash and immediately converted to a Roth. Now I can't figure out how to enter into TT

[Dave805]

Opened a Trad IRA in Dec 2024, funded with $8K post taxes cash (I'm over 50).  A day later rolled it into a Roth.

Now I'm doing my taxes and TT imported from Fidelity my 1009-R.  In the income section I answered the retirement 1099-R questions, it said "congrats, you won't have to pay taxes". and I thought that was it.

Now I'm in the deductions section, under retirement, and I filled that section out and what I need to pay jumped up, and it thinks I put too much $$ into my Roth.  It's double counting.

Where did I go wrong? And how can I specify the original Trad. IRA was opened with post tax money?

[MaryK4]

Step 1:  Enter the Non-Deductible Contribution to a Traditional IRA

1. Go to the Traditional IRA and Roth IRA screen, check the Traditional IRA box and select Continue.
2. On the Is This a Repayment of a Retirement Distribution? screen, select No.
3. On the Tell Us How Much You Contributed screen, enter the amount contributed and select Continue.
4. On the Did You Change Your Mind? screen, select No, then answer the questions on the following screens.
5. When you reach the Choose Not to Deduct IRA Contributions screen:
   1. Select Yes, make part of my IRA contribution nondeductible.
   2. Enter the amount you contributed.
   3. Select Continue.
      • Note: If none of your contribution can be deducted, you won't see the option to make part of it nondeductible. Instead, you'll see the message Income Too High To Deduct an IRA Contribution, and the full amount of your contribution will automatically be nondeductible.
6. On the Your IRA Deduction Summary screen, review the info and select Continue.

Step 2:  Enter the Conversion from a Traditional IRA to a Roth IRA

1. Go to Wages & Income.
2. On the Your income and expenses screen, locate and select the Retirement Plans and Social Security section, then select Start or Revisit next to IRA, 401(k), Pension Plan Withdrawals (1099-R).
3. Answer Yes to Did you get a 1099-R in 2024?, then Continue.
   • If you land on the screen Review your 1099-R info select Add another 1099-R.
4. Select how you want to enter your 1099-R and follow the instructions.
5. Answer the questions on the following screens, until you reach Tell us if you moved the money through a rollover or conversion.
6. Select I converted some or all of it to a Roth IRA and Continue.
7. Next, select Yes, all of this money was converted to a Roth IRA.
8. Continue answering questions until you reach the screen Review your 1099-R info.

To check the results of your backdoor Roth IRA conversion, see your Form 1040:

1. From the menu, select Tax Tools, then Tools (if you're currently using the TurboTax Mobile app, you'll need to sign in to the web browser version).
2. Under Tools Center, select View Tax Summary.
3. From the side menu, select Preview my 1040.
   • Your backdoor Roth IRA amount should be listed on Form 1040, Line 4a as IRA distributions.
   • Taxable amount on Form 1040, Line 4b should be zero unless you had earnings between the time you contributed to your Traditional IRA and the time you converted it to Roth IRA, in which case the earnings would be taxable.
   • If you have a Schedule 1, then Schedule 1, Line 20, IRA deduction should be blank.
4. Select Back to return to where you left off in TurboTax.

[Dave805]

I am using the desktop version and do not have the same headings and therefore cannot follow the same steps.

Sounds like I need to do the deductible portion first, but I still have old information entered that I need to delete.  How do I 'clean' this up so I can follow desktop steps to enter this correctly?

[MaryK4 · Accepted solution]

Delete the 1099-R that you have entered.  

THEN-

1. Select the Federal Taxes tab (this is Personal Info in TurboTax Home & Business), then Deductions & Credits.
2. Select I'll choose what I work on.
   • On the list of sections, locate Retirement & Investments.
   • Then select Start or Update next to Traditional & Roth IRA Contributions.
3. Check the box for Traditional IRA and Continue.
4. Answer Yes to Did you contribute to a traditional IRA?
5. Answer No to Is This a Repayment of a Retirement Distribution?
6. On the Tell Us How Much You Contributed screen, enter the amount contributed and Continue.
7. Answer No on the screen Did You Change Your Mind?, then answer the questions on the following screens.
8. When you reach the Choose Not to Deduct IRA Contributions screen, select Yes, make part of my IRA contribution nondeductible, enter the amount you contributed, then select Continue.
   • Note: If none of your contribution can be deducted, you will not see the option to make part of it nondeductible. Instead, you will see the message Income Too High To Deduct an IRA Contribution, and the full amount of your contribution will automatically be nondeductible.

Step 2: Enter the Conversion from a Traditional IRA to a Roth IRA

1. Select Wages & Income, then I'll choose what I work on.
2. In the list of sections, locate Retirement Plans and Social Security, then select Start or Update next to IRA, 401(k), Pension Plan Withdrawals (1099-R).
3. Answer Yes to Did you have any of these types of income in 2024? and Continue.
   • If you land on the Your 1099-R Entries screen instead, select Add another 1099-R.
4. Select how you want to enter your 1099-R (import or type it in yourself) and follow the instructions.
5. Answer No to Did You Inherit This IRA?
6. Select None of this distribution was transferred to charity.
7. Select I moved the money to another retirement account (or returned it to the same retirement account) on the What Did You Do With The Money From This Payer? screen.
8. Select I did a combination of rolling over, converting, or cashing out the money. Then, enter the full amount in the box next to Amount converted to a Roth IRA account and Continue.
9. Continue answering questions until you come to the screen Your 1099-R Entries.

To check the results of your backdoor Roth IRA conversion, see your Form 1040:

1. Select Forms from the menu.
2. Select Form 1040 from the menu.
3. Use the scroll bar to find:
   • Line 4a IRA Distributions. Your backdoor Roth IRA amount should be listed.
   • Line 4b Taxable amount should be zero, unless you had earnings between the time you contributed to your Traditional IRA and the time you converted it to a Roth IRA.
4. Select Schedule 1 from the menu if Schedule 1 appears in the list of forms.
5. Line 20 IRA deduction should be blank.
6. To return to where you left off in TurboTax, select EasyStep from the menu at the top of the screen.

[Dave805]

The problem is when I get to the step 8 of your instruction, the only thing I am presented with is to enter the info for 2023.

How do I enter it for 2024?  And this is after I deleted the 1099-R

[Dave805]

I figured it out.  The "Non-Deductible ....." for 2023 page is  not the page that is asking me for 2024.  I just needed to answer NO to that page.  The next page said I make too much $$ so I never am prompted for non-deductible contributions for 2024 - this was in your instructions.  I was then able to complete the entries following your instructions.

The question about non-deductible for only 2023 was confusing me.

So for those with this same problem with the desktop version:

- delete the 1099-R in the income section

- enter the info in the deductible section

- answer no to needing to enter non-deductible info for tax year 2023

- if the next page is not "enter non-deductible for 2024" because you make too much - that's okay.