Clarification on "Enter Your Roth IRA Contributions" screen

NotoriousBOG — Wed, 24 Feb 2021 20:37:14 GMT

The question asks: Enter your total Roth IRA contributions for 2020, even if you transferred, or 'recharacterized,' some or all of it to a traditional IRA.

Clarification needed: does this apply only to 'recharacterized' contributions or should it include conversions as well (such as a backdoor traditional IRA to Roth)? I.E. would I enter $600 or $6000 given the details below?

My situation:

I contributed $600 into a Fidelity Roth IRA in 2020. That money is untouched and remains there.
I contributed $5400 (the basis) into a Wealthfront Traditional IRA, which grew to $6100. In December 2020 I converted the entire account ($6100) to a Wealthfront Roth IRA (origination date is Dec 2020). The traditional IRA account is now closed.
I received a 2020 1099-R from Wealthfront, as expected, with Boxes 1 and 2a showing the $6100. Box 7 has code 2. IRA/SEMP/SIMPLE box is CHECKED. No other boxes are filled.

So in total I contributed exactly $6,000 to all my IRAs in 2020, but only $600 was direct, and $5400 was converted. So which number do I put on that screen? I believe it should be just the $600 otherwise it tells me that I exceeded the allowable contribution (due to MAGI being too high) which is exactly what I was trying to avoid with the backdoor conversion.

(Side note: my 1040 preview shows me being taxed on the $700 growth of the traditional prior to the conversion, as I would expect)

Re: Clarification on "Enter Your Roth IRA Contributions" screen

DanaB27 — Wed, 24 Feb 2021 21:05:50 GMT

No conversion is not included in that question. You would only enter the $600 for the Roth IRA contribution. For the traditional IRA contribution you would enter the $5,400.

Yes, you will be taxed on the growth in the traditional IRA.

topic Clarification on "Enter Your Roth IRA Contributions" screen in Get your taxes done using TurboTax

Clarification on "Enter Your Roth IRA Contributions" screen

Re: Clarification on "Enter Your Roth IRA Contributions" screen