Vanguard 1099-R for backdoor roth reducing my tax refund

[anbuitachi]

  I am not sure why it's taking off federal tax refund since it's just a conversion. Ive never filed a 8606 before. Forgot to last year.. I thought i am not supposed to owe tax on this since i arleady paid tax?

EDIT: Sorry nevvermind. Didnt realize its in credit section... Dont know how to delete this

[DanaB27]

Please be aware, if you haven't filed Form 8606 for nondeductible contributions made for 2020 then you will have to file it Form 8606 for 2020. 

Conversions are generally taxable unless you have a basis (nondeductible contributions) reported on Form 8606.

Here are the backdoor Roth steps if you like to review them.

To enter the nondeductible contribution to the traditional IRA:

1. Login to your TurboTax Account 
2. Click on "Search" on the top right and type “IRA contributions” 
3. Click on “Jump to IRA contributions"
4. Select “traditional IRA”
5. Answer “No” to “Is This a Repayment of a Retirement Distribution?”
6. Enter the amount you contributed
7. Answer “No” to the recharacterized question on the “Did You Change Your Mind?” screen
8. Answer the next questions until you get to “Any Nondeductible Contributions to Your IRA?” and select “Yes” if you had a nondeductible contribution before this tax year.
9. If you had a basis in the Traditional IRA before then enter the amount.
10. On the “Choose Not to Deduct IRA Contributions” screen choose “Yes, make part of my IRA contribution nondeductible” and enter the amount (if you have a retirement plan at work and are over the income limit it will be nondeductible automatically and you only get a warning and then a screen saying $0 is deductible).

To enter the 1099-R conversion: 

1. Click on "Search" on the top right and type “1099-R”  
2. Click on “Jump to 1099-R”
3. Click "Continue" and enter the information from your 1099-R
4. Answer questions until you get to “Tell us if you moved the money through a rollover or conversion” and choose “I converted some or all of it to a Roth IRA”
5. On the "Review your 1099-R info" screen click "continue"
6. Answer "yes" to "Any nondeductible Contributions to your IRA?" if you had any nondeductible contributions in prior years.
7. Answer the questions about the basis from line 14 of your 2020 Form 8606 and the value of all traditional, SEP, and SIMPLE IRAs