taxed on roth IRA for the amount contributed in March for the year prior

[2Double]

Hello,

Pls help. I think I made a mistake in my tax year 2024 and paid tax on amount contributed for 2023.

For tax year 2023: I contributed and did backdoor Roth IRA for tax year 2023 ($6490) in March 2024. Then, I filed year 2023 and mentioned that amount in form 8606 without having the form 1099-R from broker.  

For tax year 2024: I contributed and did backdoor Roth IRA conversion in Sep 2024 ($7001). Now I check my return of 2024 and it looks like the amount from 2023 has been considered taxable.

Form 8606 year 2024: line 1 ($7001), line 2 (ZERO), line 3 ($7001), line 5 ($7001), line 13 ($7001), line 15a ($6490), line 15c ($6490). It looks like I have been taxed on ($6490). 

I think I should get a refund on that tax I paid for that ($6490), correct? Please help how to amend my return. I think I should amend the return year 2024, correct?

Thanks a lot

[baldietax]

think of the backdoor Roth as two separate transactions, a non-deductible contribution (which is limited but can be back-dated to prior year until April 15th), and a Roth conversion (which has no limit other than how big your Trad IRA, but cannot be backdated - it is reported in the calendar year it occurs).

So your 2023 Backdoor Roth done in March 2024 was just a non-deductible contribution for 2023 reporting.  Your 2023 Form 8606 should have had $6490 on Lines 1, 3, 14 and this carries over to 2024.

For 2024, that $7001 odd number sounds like a $7000 contribution and $7001 conversion due to some earnings in the IRA while all this is being processed (which is ok).  You should have received 1099-Rs for 2024 reflecting both the conversion in March and September, totalling $13,941 which should be flowing into the 8606 on Line 8 which seems to be missing from your figures - this usually happens if the questions after the 1099-R input did not correctly identify these 1099-Rs as Roth conversions.

Your 2024 8606 should have:

Line 1 = $7000 (not 7001)

Line 2 = $6940 (carried over from 2023)

Line 3 = $13940

Line 8 = $13941

and then the rest of the 8606 math should kick out that $13940 of your Roth conversions were not taxable, and you owe tax on $1.

Hopefully this helps point you in the right direction.

Here are the latest instructions for entering Backdoor Roths tho they've been updated for 2025 and some of the screens have changed at least in desktop, but the general principles are the same

https://ttlc.intuit.com/turbotax-support/en-us/help-article/retirement-benefits/enter-backdoor-roth-...

[2Double]

@baldietax Hello, thanks for the reply. Do you mean I should amend both 2023 and 2024? I considered both contribution and conversion for 2023 completed but looks like you mention contribution should be for 2023 and conversion reported on 2024? Appreciate your help.

[baldietax]

It's a bit confusing in your comments in both threads whether/when you reported the 1099-R for the $6490 and what is on line 8 of your 8606's for 2023 and 2024 and as you're not mentioning that line; here's the other thread for ref...

https://ttlc.intuit.com/community/taxes/discussion/re-roth-ira-conversion-got-taxed-again/01/3797137...

refer to the 1099-R (distribution/conversion) and 5498 (contribution) forms which should confirm for you in which tax year to report which piece.

in the other thread you list 2023 8606 Line 13 as $6490 which implies you may have entered the conversion for 2023 without the 1099-R, tho don't mention line 8.  You should end up with $6490 on Line 14 and that will carry over to 2024 8606 Line 2.

I'm not a CPA but I think if you don't have any changes on 1040 then you don't need to amend the return and can just send in the 8606 to record the correct basis; but for 2023 it depends what you reported on 1040 Lines 4a/4b and 8606 Line 8.

[2Double]

@baldietax Thank you for your reply.

Iines 4 and 8 are blank on both 2023 and 2024. I have only mentioned lines with value.

I received form 5498 for 2023 but no 1099-R for 2023. 

I received one 1099-R for 2024 which shows 13,490.75$ gross distribution and taxable which is combination of contribution 2023 and 2024. 

Based on this, do I only need to amend 2024? 2023 is ok? 

Thanks a lot.

[baldietax]

ok so that 1099-R and 5498 reporting makes sense - no conversion in 2023 only contribution.

The only issue I see with 2023 is lines 13/14 on the 8606, you should check, maybe you just wrote the wrong line number in the other thread - the 8606 should reflect a basis carryover to 2024 on line 14.  it's correct for line 8 to be blank in 2023 as there was no conversion.

and for 2024 again to recap I think you have 3 issues:

(1) reflecting the carryover from 2023 of the basis on 8606 line 2

(2) check 2024 contribution was $7000 not $7001 (see 5498 for 2024) on 8606 line 1

(3) reflecting the conversion from the 1099-R on 8606 line 8 - usually an issue with the questions that follow the 1099-R to specify you did a conversion (not a rollover etc).