I rolled over a Traditional IRA account from one bank by a check payable to another bank that took out 10% tax and converted it to a ROTH IRA. I received two 1099 R with the same code 7 in box 7 and the box IRA/SEP/SIMPLE checked on both forms from the two banks. When I entered the data into TT, it inflated the amount of income by duplicating the IRA amount from the two banks. I was told that form 5498 should fix it. Need help in removing that duplication.
Since you got two Form 1099-R, one from each bank, consider the following information when you enter it into your tax return.
You took a distribution from your Traditional IRA from Bank A and rolled the money into a Traditional IRA in Bank B. When you enter this into TurboTax, pay close attention to the distribution code shown on your form and answer the questions as if you rolled the money over to another Traditional IRA account instead of a Roth IRA. This distribution from Bank A will not be taxable on your return.
Then, you technically took a distribution from your Traditional IRA from Bank B and converted it to a Roth IRA. When you enter this into TurboTax, answer the questions as if you converted the money to a Roth IRA. You will need to choose 'I did a combination of rolling over, converting, or cashing out the money' in order to see the box for entering the amount that was converted to a Roth IRA. This distribution will be taxable on your return.