Backdoor Roth and a unique circumstance

[Robbie29]

Good day everyone. I'm looking for some guidance. I have a rather unique circumstance regarding a "BackdoorRoth".  So here's my story.

I am a Federal Government employee and fall under the Civil Service Retirement System Offset (CSRS Offset) Plan. I am able to make a voluntary contribution to my retirement of up to 10% of my lifetime earnings and this goes into a Traditional IRA and then transfers to a Roth IRA. So I moved $50,000 from a taxable account into an IRA in late 2019 and I received a 1099-R for 2019. The funds then transferred into a Roth IRA in January 2020.  This is in addition to the $26,000 I contribute to my Thrift Savings Plan (TSP) each year.

I filed my 2019 taxes in March 2020 and did not enter any information related to my Roth as the Roth wasn't established until 2020 and thus wasn't reportable until I filed my 2020 return.  After I filed my taxes, I made a $7000 (that's the limit for those over 50 or 55 years of age)  contribution into the Roth (via the Backdoor Roth) for 2019 and and additional $7000 for 2020. I didn't submit an amended 2019 return. Perhaps that was a mistake?

So here I am in February 2021 preparing to submit my 2020 taxes and I have no clue what to do. Should I have submitted a 2019 amended return, even though my contributions to the Roth were made using after tax funds? If so, is it too late to submit an amended 2019 return? Looking for some solid advice before I throw in the towel and pay a tax advisor/preparer to help me out.

Thanks everyone!

Robbie 29

[Robbie29]

Hi folks. I did a little more digging and found that my initial Roth account was actually opened in late December 2019 (not 2020) and was considered an "in flight conversion" where the investment firm knew it was going to be converted to a Roth so they simply put the funds directly into a Roth IRA. I hope this makes sense.

Anyhow, again, this was after tax funds that went into the Roth. That said, my question is, should I go back and amend the 2019 taxes for this omission and include the 2019 $7000 contribution for tax year 2019 made in 2020 after the taxes were filed?

Believe it or not, I actually am fairly well organized!

Thanks,

Robbie29

[ThomasM125]

You don't need to amend the 2019 tax return to enter the ROTH IRA contribution of $7,000, since it won't appear on the tax return, as it is not deductible.

[Robbie29]

Thanks ThomasM125!  None of the three contributions (the initial $50,000, the 2019 $7000 and the 2020 $7000) is dedcutible. I still need to include the three Roths in my 2020 tax return though, don't I?

[ThomasM125 · Accepted solution]

The ROTH contribution will not appear on your tax return. However, you should enter it in TurboTax to make sure it is allowable, based on your other entries.