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Level 2
posted Feb 8, 2020 11:15:45 PM

Taxable IRA Distributions

In 2019, my wife and I each contributed non-deductible $6k to an IRA.  We then converted all of this to a Roth IRA.  We received a 1099-R showing a total of $12,004.  Entering this into TurboTax, it gave us a message that we don't owe extra taxes on this money.  When I finish the deduction section, I get the following message: 

 

Where is the taxable $9,537 coming from?

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1 Replies
Expert Alumni
Feb 9, 2020 8:17:26 AM

 

 

It depends on how your Form 1099-R is reported and how much nondeductible contributions you have made. 

 

If you have made any nondeductible contributions to your traditional IRA, you do not pay taxes on the entire conversion amount.  Those nondeductible amounts are so-called the basis.  To see how this amount is calculated, I suggest you review your Form 8606 Nondeductible IRAs. 

 

For more information about the Form 8606, click here Nondeductible Contribution