topic Re: Backdoor roth errors in form 8606 part II in Retirement tax questions

Backdoor roth errors in form 8606 part II

sk750 — Tue, 20 Apr 2021 05:02:27 GMT

i'm trying to report the backdoor roth conversion in turbotax. I did the following:

First I did wages&income:

1099R - entries from the custodian. Distributions were 6005 (contributions were 6000 but I waited before conversion and want to report $5 as taxable income).

Based on your entry for Box 7 on 1099R, you dont need to pay extra taxes on the money taken out of this account (so for so good)

Did I inherit - No

What did you do with the money from xxx?

I moved the money to another retirement account (or returned to the same acocunt)

I rolledover the money.

***********************

Then I went to deductions&credits

Traditional & Roth IRA contributions

I selected Traditional IRA only (as I technically contributed to traditional IRA and then did a backdoor roth conversion)

Is this a repayment of a retirement distribution? No

Tell us how much you contributed? 6000

Tell us how much of this is between jan 1 2021 & may 17 2021? 0

Did you change your mind? No (I did not switch or recharacterize any contributions)

Any excess contributions before 2020? No

Any non deductible contributions to IRA? I made and tracked non-deductible contributions to IRA

Lets find your IRA Basis? Total IRA basis as of Dec 31 2019 - 0

Is this a repayment of a retirement distribution? No

Then I get the Income too high to deduct IRA contribution and my IRA deduction summary as 0.

*******************

when I go to forms under 8606, I see that Part II (lines 16,17,18) are not populated and my total tax liability is still shown as 0.

I was expecting line 16 to be 6005, line 17 to be 6000 and line 18 (taxable income) as 5.

i've been doing this for years with no issues and it looks like something is wrong with Turbotax 2020. Did anyone else see the same issue? Did I miss any steps? Any help is greatly appreciated. Thanks!

Re: Backdoor roth errors in form 8606 part II

sk750 — Wed, 21 Apr 2021 03:58:16 GMT

I was able to figure this out but posting it in case others have similar issue.

You need to answer the following question correctly when filling out 1099-R

What did you do with the money from XXX?

* I moved the money to another retirement account (or returned to the same account).

Choose which of the following applies?

* I did a combination of rollover, converting or cashing out the money [THIS IS NEW IN 2020, UNTIL LAST YEAR TURBOTAX HAD AN OPTION FOR SELECTIONG "I converted all of this money to ROTH IRA".

Then select

* Amount rolled over to another retirement account - 0

* Amount converted to a ROTH IRA account - 6005 (in my case).

Hope this helps!

Re: Backdoor roth errors in form 8606 part II

macuser_22 — Wed, 21 Apr 2021 04:25:59 GMT

@sk750 wrote:

* I did a combination of rollover, converting or cashing out the money [THIS IS NEW IN 2020, UNTIL LAST YEAR TURBOTAX HAD AN OPTION FOR SELECTIONG "I converted all of this money to ROTH IRA".

Yes, I think that it the question was removed when the COVID updates took place. I don't know if it was intended or a mistake.

(The online version still has the convert all option but the interview is different.)

Re: Backdoor roth errors in form 8606 part II

lschwel — Tue, 04 May 2021 19:42:37 GMT

this was very helpful! I couldn't figure out why Part II of 8606 was different than last year when I did the exact same conversion to a Roth. Thank you! Turbo Tax should go back to the choices from last year.