As a 50+ year old I can put up to $6,500 into a Traditional IRA for 2017 without any tax implications as the money had already been taxed as part of the taxes on my salary. I was told that the Traditional IRA could be converted into a Roth IRA, which I did. Again no tax implications. While doing my taxes I find out that my contributions to the Roth IRA is actually being taxed in TurboTax, despite I already paid tax as mentioned above. The contributions to Traditional IRA is not being taxed in TurboTax. So my question is:
1. Is there an error in TurboTax, or is it correct that the Roth IRA should be taxed again, while the Traditional IRA is not being taxed?
I'll be very interested in hearing the community's experience with this.
Thanks a lot.
Well, I'm not sure about no tax consequences when converting from a normal IRA to a Roth IRA. A quick Google yielded the following article, which seems pretty clear. Hopefully, since you are contributing after tax dollars to your IRA, perhaps the info in this article does not apply to the portion of your IRA that was bought with after tax dollars (?). Just out of curiosity, why are you contributing after tax dollars to an IRA in the first place?
https://www.thebalance.com/who-should-not-convert-to-a-roth-ira-2894480
Hope this helps,