topic IRA Backdoor - Does it appear on tax return transcript? in Deductions & credits

IRA Backdoor - Does it appear on tax return transcript?

netguy — Sat, 09 Oct 2021 14:16:00 GMT

For the 2020 tax season, I did my first backdoor roth IRA. I contributed a total of $18,000 to my SEP IRA, and did a ROTH IRA conversion on $6,000 via vanguard. I have my SEP and ROTH with them. I did this conversion in January of 2021. I am now looking at my return transcript and I see:

"KEOGH/SEP CONTRIBUTION DEDUCTION: $12,000 "

This makes sense as it matches the total for the SEP contributions minus the $6,000.

But when I search for the $6,000 it's no where to be found. I am wondering if this is part of another item on this return transcript that's added up all together? Or should it be a line item on this transcript?

I vaguely remember having this conversation with my accountant (who is no longer around). Stating that I will need to pay taxes on it the 2021 season. We went back and forth on this for a while and I don't remember what we finally decided on.

I am ultimately trying to figure out somehow if I already paid the taxes or if I need to make sure and do that this year.

Re: IRA Backdoor - Does it appear on tax return transcript?

Critter-3 — Sat, 09 Oct 2021 14:40:09 GMT

The return should have shown $18K SEP IRA contribution and $6K conversion but it looks like you did not enter it correctly since you are only seeing a $12K contribution. So to the IRS it shows only the $12K to the sep and nothing for the ROTH contribution as they are not reported on the return. All in all the same bottom line is achieved unless you were not allowed to make a ROTH contribution due to income limitations. If that is the case you may want to amend the return ... review the form 5498 for the SEP & ROTH to see what got reported to the IRS.

Re: IRA Backdoor - Does it appear on tax return transcript?

tbrown21 — Tue, 12 Oct 2021 18:09:55 GMT

The $6000 will not be on your 2020 tax transcript, as it was converted to a roth in 2021. You will receive a 1099R for the $6000 in 2022 for your 2021 taxes, which you will have to pay taxes on.

Re: IRA Backdoor - Does it appear on tax return transcript?

fanfare — Fri, 15 Oct 2021 00:57:39 GMT

If you did not pay the correct tax due, IRS will be in touch.