Question about backdoor Roth

[giraffe223]

My spouse did a backdoor roth in Mar 2025. At the time, we had $0 in Traditional IRAs.

In Oct 2025, he rolled over an old $40k Traditional 401k to a Traditional IRA. He then moved the amount from the Traditional IRA to his current employer's Traditional 401k.   Therefore, the amount in Traditional IRAs as Dec 31, 2025 is still $0.

When I filled out my taxes, it is showing that $6.9K of the roth contribution from my spouse isn't tax exempt.  Is that correct?  Given we had $0 Traditional IRA at year end, why is it calculating such a low "total basis in traditional ira"?

[maglib]

@giraffe223   ROTH IRA contributions are fully taxable and are not tax exempt.  They grow tax free and upon withdrawal there is no tax on the RMD.  Verses a Traditional IRA which for Federal Purposes the contribution is tax exempt, it will grow tax free but, your distributions will be fully taxable in the future.

I am confused about your basis question.  There should be no basis in the traditional IRA as you transferred it to a 401k. 

You can transfer a 401(k) to an IRA and later move those funds into a new employer’s 401(k) (a reverse rollover)

 This process is generally tax-free if done directly through custodian-to-custodian transfers. You can only move pre-tax money back into a traditional 401k

[dmertz · Accepted solution]

There was no Roth IRA contribution.  There was a traditional IRA contribution and a Roth conversion.

If the Roth conversion it being shown on Form 1040 line 4b as being partially taxable, check Form 8606 to see how much of the traditional IRA contribution is being treated as nondeductible (line 1).  Any portion of the traditional IRA contribution that is not being treated as nondeductible should be present on Schedule 1 line 20 as a deductible traditional IRA contribution.  Also make sure that you have told TurboTax that the year-end balance in traditional IRAs was zero.