Hi, did a backdoor Roth this year. I contributed $7000 to traditional IRA in my Vanguard account, but while I was waiting for the time that the funds were available to be converted, I ended up accruing a small interest in the tradtional IRA account. the value became $7004. As a result, I contributed an additional $4 and converted to Roth ($7004. in Roth IRA). How do I enter this in my Turbotax? My accountant says that I need to withdraw the $4 or I will be fined for it every year it stays in the Roth account? I read on this forum that turbotax will make any adjustments to the tax reporting though? What do I do? Please guide me step by step, thank you.
No, you do not need to withdraw the $4. The Roth conversion is not a contribution to the Roth IRA. Backdoor Roth is completed in two steps, the nondeductible contribution to the traditional IRA and the Roth conversion. The $4 will be taxable income in the Roth conversion.
Please see How do I enter a backdoor Roth IRA conversion? for instructions.