IRA funds converted to a Roth incorrectly included in MAGI for determining IRA contribution limit

[marciem]

Married filed jointly. My husband, who contributes to a workplace retirement plan & is over 59 ½, converted his Traditional IRA to a Roth this year. I do not have a workplace retirement plan and should be able to deduct a contribution to a Traditional IRA. However, TurboTax says my Traditional IRA contribution is not deductible because our MAGI is too high. TurboTax is incorrectly including the conversion funds in our MAGI. After inputting my husband’s 1099-R which shows the conversion as a distribution, I’ve indicated that it was all converted to a Roth. The conversion amount is taxable, but it should not be included in MAGI to determine my eligibility to make a deductible IRA contribution. How do I correct this problem? Thank you for your help.

[ThomasM125]

TurboTax is considering the distribution to be income even though it was rolled into the ROTH. Have you researched this to confirm that this is not the correct treatment? Since the distribution is considered taxable income, it would make sense that it would be considered income for the MAGI purposes.