TurboTax 2024 Premier Desktop
In 2024, I converted about $200,000 from Traditional IRA to Roth. Forms 5498 and 1099R were filled out.
Distribution code on Line 7 (1099) shows 7. IRA/SEP/Simple is checked.
Using TurboTax Premier, it calculates (Form 5329-T) that I have about $190,000 of excess contributions.
I am then penalized 6% more in taxation on that excess in the T-Tax calculations.
This should not be characterized as excess contribution since it was a Conversion from Traditional to Roth.
I am old enough that RMD's are required on the Traditional IRA, if that makes any difference in these rules.
Only enter it from the 1099R. Nowhere else. Not under deductions as a contribution. It is not a new contribution.
Ok. It is in the IRA Contributions Worksheet, Line 19. And the wording there does say not to put in any conversions. So, why is TurboTax automatically populating that line?
The only way would be if you entered it under Deductions & Credits for IRA contributions. Go back and delete it from there.
Federal
Deductions and Credits
Then scroll down to Retirement and Investments
Traditional and ROTH IRA Contributions - Click the Start or Update button
You might need to delete the 1099R and enter it again Manually (especially if you imported it).
I am going to go with delet 1099 and manually enter it.
If nothing else, it might show me where the error first enters.
Thank you so much for your help.
If I get a clear resolution, do you want to know?
I did a whole new return. It looks correct with small refund.
I did all manual entries, no download
before that, I did delete 1099 entry on the old return, but it was still messed up.
There were still entries in contributions, so rather than sort it out, I started over.
If I knew the system better, I think I could have corrected the old one.
But the Roth entry in contributions on deductions category is auto populating with 1099 download and causing problems.
That's just as you suggested.
Thanks for help