I have been advised to amend my 2018 return due to a Roth contribution plus earnings I had to withdraw in 2019. (The funds were transferred to an IRA account). I have a 2019 1099-R that reports the amount of the withdrawal. 2 questions: (1) Is that 1099-R to be used for amending the 2018 return? (2) If a Roth conversion of a deductible IRA had also been done in 2018, do I need to recalculate the taxable % of that conversion based on the funds that were deposited back into the account (even though it didn't happen until 2019)? Thank you for any help!
The answer to your first question is No. The 1099-R was withdrawn in 2019 and the conversion made in 2019. So, it looks like the transaction has nothing to do with 2018. If you were withdrawing excess contributions and earnings, then any remedial action should have been taken before April 15 of 2019.
For your second question, converting a nondeductible IRA to a deductible IRA should trigger the 8606 basis form in 2018. Based on that, you can amend your 2018 return to establish your basis in the IRA.
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Thanks for your reply. Regarding question #1, it was indeed excess contribution plus earnings that I withdrew, and it was done by April 15, 2019. Are you saying that since I have a 2019 1099-R for that transaction, I should report it only in 2019, or should I go back and amend the 2018 return?
Regarding question #1, here is the timeline of all the transactions:
Feb, 2018: Contribution made to Roth IRA account (account 1)
March, 2018: Entire IRA (account 2) funds transferred to Roth IRA (account 1) (100% reported as taxable on return filed in April 2019)
April, 2019: contribution shown above plus earnings withdrawn and transferred to account 2 when flagged by TurboTax.
So my question #2 was: when the Feb 2018 contribution into account 1 was undone, and the (non-deductible) funds ended up in account 2, is it correct to say that 100% of the 2018 conversion was taxable? Or do I need to pro-rate it? Thank you again!