1099-R Taxable Issue

Forum|Forum|1 year ago
February 16, 2025
1 reply
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Hello Everyone,

I have a 1099-R that has a 14000 value in box 1, 2b, and 2c is checked. My return is showing 7000 as my tax basis, but it should be $0 as its all conversion to Roth

How can I solve this? If i enter the 1099-R as is, this continues to be the tax liability assessed

Thank you!

KrisD15

Level 15

To clarify, Was this traditional IRA to Roth

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JPGup90Author

Level 2

Yes that is correct

JohnB5677

Level 15

Box 1 and 2A are $14455.24. Box 2b is checked and the IRA/SEP/SIMPLE is as well. Distribution code is 2.

In 2023 I contributed the full $6500 into a Roth. Later I realized I had to much income and recharacterized to traditional in 2024 (before filing 2023 taxes). No deductions taken for any of the contributions

On top of the 1099-R I am mentioning, I do also have another for the recharacterization with 7440.63 in box 1, 0 in box 2a, unchecked box 2b, distribution code R.

My 1040 shows my taxable amount on IRA distribution to be 7440.63

Was the $14,455.24 a distribution in 2024 from the ROTH?

If so, this portion is not taxable.

Regarding the second 1099-R:

Code R is Recharacterized IRA contribution made for 2023.
This should not be on your 2024 tax return.
This is a taxable event. But it should be included on your 2023 tax return.
- Traditional IRA's are not taxed on the contribution, but they are taxed when withdrawn.
- ROTH IRA's are taxed upon contribution, and not taxed upon withdrawal.
If you created a substitute 1099-R and paid the tax in 2023,
- You do not have to enter the second 1099-R code R in 2024.
- You've already paid it.
If you did not enter it on your 2023 return you will have to amend it.