Level 3

Question

Backdoor Roth Contribution

Forum|Forum|5 years ago
March 20, 2021
17 replies
23 views

I am having trouble with the mechanics of this. I have listed the 1099R as fully taxable. Then showed the amount converted as fully converted in Box 5. On B4 at the bottom of the 1099R form I have checked the box as fully converted.

I cannot get the income to go away.....it still lists it as taxable.....is there an update coming? Or am i not doing something right?

ProSeries Basic

This topic has been closed for replies.

Just-Lisa-Now-

Intuit Community Champion

Do you have non deductible basis in the IRA flowing from he 8606? If not, then its not backdoor, its a taxable IRA distribution that's been converted to a ROTH.

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪

K

kensuzyAuthor

Level 3

yes we make too much money to have a deductible ira. so my client made an ira non deductible ira and immediately switched it to roth. This is the backdoor roth as is described in all of the literature. We have done this every year in this software and it has worked....i just can't get it to work this year

qbteachmt

Level 15

"we make too much money to have a deductible ira. so my client"

We? Your Client? We or your client? Whose tax return is this?

"made an ira non deductible ira and immediately switched it to roth."

It's a Conversion, but nontaxable, because the IRA amount already went in post-tax. As long as it was done quickly, there are no earnings to tax. As long as there are not other amounts in other deferred accounts, this is nontaxable.

Over all other accounts. Not just this one account.

"This is the backdoor roth as is described in all of the literature. We have done this every year in this software and it has worked....i just can't get it to work this year"

Read this article:

https://proconnect.intuit.com/community/individual/help/proseries-form-1099-r-faq-s/00/4853

Don't yell at us; we're volunteers

qbteachmt

Level 15

"I have listed the 1099R as fully taxable."

The issuer doesn't know what was done with the funds, nor if there is basis in this or any other Trad IRA account, so they would mark it as Ordinary and Taxable or Not determined, coming from a deferred account type.

"Then showed the amount converted as fully converted in Box 5."

Was this Trustee-to-trustee? Was there no withholding?

"On B4 at the bottom of the 1099R form I have checked the box as fully converted."

Is that the only deferred amount and account owned by that person?

Don't yell at us; we're volunteers

K

kensuzyAuthor

Level 3

it was marked taxable not known

it was trustee to trustee because of the way backdoor works. You make the contribution and it is non-deductible, they give a 1099r which i put in the system. it is rolled over to roth. the taxpayer never sees the money. so yes it is trustee to trustee

we have done this in all years before and it has worked. Now the software doesn't seem to allow it. so....are there other accounts??? only for prior year contributions to roth rolled over.

these questions all are directed at whether this qualifies as backdoor roth. I am convinced it does. The taxpayer was convinced. The broker was convinced. We have done this every year for 4-5 years. How do i get the software to give me the answer like it has in prior years?

Just-Lisa-Now-

Intuit Community Champion

"You make the contribution and it is non-deductible, they give a 1099r which i put in the system."

They dont give you a 1099R for a contribution.

You get the 1099R when you convert to a ROTH, you need to have a non deductible IRA basis in your 8606 to make it all flow.

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪

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