Back door Roth Confusion

[Richmond]

Jan 2025 contributed to 2024 traditional IRA, did a conversion to Roth IRA.

Mar 2025 Filed 2024 Taxes, tax guy did not include Form 8606

Apr 2025 contributed to 2025 traditional IRA, did a conversion to Roth IRA

May 2025 received Form 5498 from Vanguard. Box 1 shows the $7000 “IRA contribution” but nothing for box 3 “Roth IRA Conversion”

Jan 2026 received 2025 1099R Form from Vanguard with $14,005 in box 1 and 2a “Gross Distribution” and “taxable amount”. Box 2b is checked for “taxable amount not determined”. Box 7 is checked for “distribution code 2” “IRA/SEP/SIMPLE”

March 2026 did some reading online and found out Form 8606 should have been included with my 2024 tax return. Went back to tax guy to file an amended 2024 return which includes Form 8606.

My question is, is everything correct now? Will I get a corrected 2024 Form 5498 from vanguard? Do I still enter the info from my 2025 1099R form as it is on my 2026 taxes or will I receive a corrected one and should file for an extension to wait for it? Really hoping this is the end of the saga. Thanks in advance!

[baldietax · Accepted solution]

think of backdoor Roth as 2 separate transactions, the contribution can be backdated to prior tax year until April 15th, but the conversion applies to the calendar year it is done it is not backdated, even if you do them both 'together' they are split across 2 years for tax reporting in this situation.

so for 2024 all you did was a contribution, the 2024 Form 5498 is correct but yes you should have filed Form 8606 to record only the contribution, you did not do a conversion for 2024 tax year.  2024 Form 8606 should reflect $7000 on Line 1 and 14 which is carried forward to your 2025 Form 8606 on Line 2 to give you a total basis of $14000 to line up with the conversion of $14005.

Your 2025 1099-R is also correct as you did both Roth conversions in 2025.

The outcome for 2025 is you will pay tax on the $5 earnings and have no basis carryover - provided your IRA market value at year-end was $0.