Turbo Tax Tira to Roth backdoor help

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
Post Reply
Topic Author
ACA
Posts: 58
Joined: Wed Nov 29, 2017 7:51 am

Turbo Tax Tira to Roth backdoor help

Post by ACA » Fri Apr 12, 2019 8:42 am

Wife and I contributed and then converted in 2018. When I enter 1099-R in Turbotax it taxes the amount. Both our Tira accounts were $0 on 12/31/2018 and total funds contributed were converted to Roth also with Vanguard.

If I click the converted box, my tax due goes up. If i click rollover box, my tax due does not change...

I get “Based on your entry for box 7 on 1099-R, you don't need to pay any extra taxes on the money taken out of this account.” but the “tax due” at top of TurboTax increases for each 1099-R entered for conversion. What am I doing wrong?

cas
Posts: 564
Joined: Wed Apr 26, 2017 8:41 am

Re: Turbo Tax Tira to Roth backdoor help

Post by cas » Fri Apr 12, 2019 8:59 am

It sounds like you haven't yet gone through the Turbotax section where you enter the contribution to the tIRA and designate it as a non-deductible contribution, so the Form 8606 isn't filled out with all the necessary information yet.

More to the point: The Finance Buff has a blog post, with screen shots, on how exactly to enter things into 2018 Turbotax so that tax reporting is done correctly. (The Boglehead's wiki on "Backdoor Roth" links to this TFB post.) You may find it useful. https://thefinancebuff.com/how-to-repor ... botax.html

Topic Author
ACA
Posts: 58
Joined: Wed Nov 29, 2017 7:51 am

Re: Turbo Tax Tira to Roth backdoor help

Post by ACA » Fri Apr 12, 2019 9:01 am

Boom!

You are correct!!!!!

Thank you very (VERY) much. @cas

Topic Author
ACA
Posts: 58
Joined: Wed Nov 29, 2017 7:51 am

Re: Turbo Tax Tira to Roth backdoor help

Post by ACA » Sat Apr 13, 2019 6:50 pm

So one more question...

We have 1099-R forms for contributions made in 2018 for 2017 tax year. We also made a contribution in 2019 for 2018 tax year (of course no 1099-R yet). Do I use the 1099-R and enter the 2019 contribution for tax year 2018?

We don’t qualify for a deduction for any Traditional IRA contribution nor can we make a Roth contribution so we back door it every year.

User avatar
FiveK
Posts: 6641
Joined: Sun Mar 16, 2014 2:43 pm

Re: Turbo Tax Tira to Roth backdoor help

Post by FiveK » Sat Apr 13, 2019 7:37 pm

ACA wrote:
Sat Apr 13, 2019 6:50 pm
So one more question...

We have 1099-R forms for contributions made in 2018 for 2017 tax year. We also made a contribution in 2019 for 2018 tax year (of course no 1099-R yet). Do I use the 1099-R and enter the 2019 contribution for tax year 2018?

We don’t qualify for a deduction for any Traditional IRA contribution nor can we make a Roth contribution so we back door it every year.
1099-R forms document withdrawals (and perhaps conversions), not contributions, so it isn't clear what is covered by those 1099-Rs. One could guess, but can you elaborate?

Topic Author
ACA
Posts: 58
Joined: Wed Nov 29, 2017 7:51 am

Re: Turbo Tax Tira to Roth backdoor help

Post by ACA » Sat Apr 13, 2019 9:09 pm

FiveK wrote:
Sat Apr 13, 2019 7:37 pm
ACA wrote:
Sat Apr 13, 2019 6:50 pm
So one more question...

We have 1099-R forms for contributions made in 2018 for 2017 tax year. We also made a contribution in 2019 for 2018 tax year (of course no 1099-R yet). Do I use the 1099-R and enter the 2019 contribution for tax year 2018?

We don’t qualify for a deduction for any Traditional IRA contribution nor can we make a Roth contribution so we back door it every year.
1099-R forms document withdrawals (and perhaps conversions), not contributions, so it isn't clear what is covered by those 1099-Rs. One could guess, but can you elaborate?
We contributed to traditional and converted to Roths.

User avatar
FiveK
Posts: 6641
Joined: Sun Mar 16, 2014 2:43 pm

Re: Turbo Tax Tira to Roth backdoor help

Post by FiveK » Sat Apr 13, 2019 9:46 pm

ACA wrote:
Sat Apr 13, 2019 6:50 pm
We have 1099-R forms for contributions made in 2018 for 2017 tax year.
You filed form 8606 for 2017 to document the non-deducted 2017 tIRA contribution, correct?
We also made a contribution in 2019 for 2018 tax year (of course no 1099-R yet).
You will file form 8606 for 2018 to document both the non-deducted 2018 tIRA contribution and the 2018 t->R conversion, correct?
Do I use the 1099-R and enter the 2019 contribution for tax year 2018?
The 2018 1099-R box 1 will go toward form 1040 line 4a. The 2018 form 8606 will go toward form 1040 line 4b.

Does that make sense?

Topic Author
ACA
Posts: 58
Joined: Wed Nov 29, 2017 7:51 am

Re: Turbo Tax Tira to Roth backdoor help

Post by ACA » Sun Apr 14, 2019 4:06 pm

FiveK wrote:
Sat Apr 13, 2019 9:46 pm
ACA wrote:
Sat Apr 13, 2019 6:50 pm
We have 1099-R forms for contributions made in 2018 for 2017 tax year.
You filed form 8606 for 2017 to document the non-deducted 2017 tIRA contribution, correct?

Yes
We also made a contribution in 2019 for 2018 tax year (of course no 1099-R yet).
You will file form 8606 for 2018 to document both the non-deducted 2018 tIRA contribution and the 2018 t->R conversion, correct?

If that’s what I should do, yes...
Do I use the 1099-R and enter the 2019 contribution for tax year 2018?
The 2018 1099-R box 1 will go toward form 1040 line 4a. The 2018 form 8606 will go toward form 1040 line 4b.

So the 2017 1099-R that I received recently goes where? I did the 8606 last year to document I contributed to 2017 and 2018 Traditional IRA...

Does that make sense?
:oops:

Topic Author
ACA
Posts: 58
Joined: Wed Nov 29, 2017 7:51 am

Re: Turbo Tax Tira to Roth backdoor help

Post by ACA » Sun Apr 14, 2019 4:21 pm

So I filed 8606 for tax year 2017. Do I need to enter 1099-R since I did conversion in 2018?

User avatar
FiveK
Posts: 6641
Joined: Sun Mar 16, 2014 2:43 pm

Re: Turbo Tax Tira to Roth backdoor help

Post by FiveK » Sun Apr 14, 2019 4:53 pm

ACA wrote:
Sun Apr 14, 2019 4:21 pm
So I filed 8606 for tax year 2017. Do I need to enter [the 2018] 1099-R since I did conversion in 2018?
"Yes" to the question as edited.

Post Reply