To report a backdoor Roth IRA contribution in TurboTax Online, follow these key steps:
1. Enter Your Traditional IRA Contribution: Go to the Federal Taxes section, then select Retirement Plans and Social Security. Find and enter your nondeductible contribution to a Traditional IRA.
2. Indicate the Contribution is Nondeductible: When prompted, select the option that your contribution is nondeductible to avoid double taxation.
3. Report Roth IRA Conversion: Proceed to the section for IRA conversions. Enter the amount you converted from the Traditional IRA to a Roth IRA.
4. Complete Form 8606: TurboTax will guide you to fill out Form 8606, which reports nondeductible contributions and conversions related to the backdoor Roth IRA.
5. Review and File: Review your entries carefully before filing.
This process assumes you have already made a nondeductible contribution to a Traditional IRA and then converted it to a Roth IRA in the same tax year. This is the common "backdoor" method if your income exceeds Roth IRA limits.
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