Conversion of traditional IRA to Roth IRA

[sly]

I'm using Pro Series Professional.  Client converted Traditional IRA  tp a Roth.  I entered the 1099R coded G.  Now I need step by step instructions to get the converted amount to form 8606 Part 2 to report it as taxable..  nothing I try works. Please,  HELP!   

[Just-Lisa-Now-]

It shouldn't have been coded as a G.   Are you sure it went into a ROTH? 

Have you seen the statement showing the deposit and it shows that its a ROTH account?   

Clients dont always know for sure whats really happened. 

I have clients that convert from a Traditional to a ROTH every year, they're never coded as a G.

[ljr]

if it went into a Roth it is taxable and should not be a code G

[sly]

The 5498 shows  "2023 IRA Contribution Information"  then it shows  the Fair Market value of the account, the  Roth conversion amount & a normal Roth contribution for 2023.  I cannot find a worksheet that shows 2023 conversion amount where I can put in the amount converted that will flow to the 8606 Part 2.

[Just-Lisa-Now- · Accepted solution]

With a code G I dont think it will flow to the 8606 like youd expect, it also wont make it taxable like it should be if its got a Code G

If it were a Code 2 or 7 and you marked the Conversion box on Page 2 of the 1099R worksheet, then everything would flow as it should, but that Code G is throwing a stick in the spokes. 

[sly]

I just put in a code 2 on the 1099R & it flowed to the 8606.  So the client needs to go back & have the code changed from a G to a 2? Right?

[Just-Lisa-Now-]

I doubt the financial institution will want to make any corrections, as long as the client has it reported right, Id just move on.

[qbteachmt]

This is the same subject as your original topic here, right?

https://accountants.intuit.com/community/proseries-tax-discussions/discussion/client-converted-tradi...

Same taxpayer? Because we asked for some confirmation, if this was SEP, SIMPLE IRA, employer plan, or did you confirm it was from a Traditional IRA? And for the to account, was the Roth IRA, or Roth 401(k) or?

The G identifier indicates plan and not Account. That means there is a retirement Plan, such as under an employer or self-employed (SEP) and there will be plan documents. Not just accounts. Trad IRA and Roth IRA are individual (nonemployer plan) accounts.

"The 5498 shows  "2023 IRA Contribution Information"  "

That's helpful. I am the one that mentioned getting the 5498.

A contribution is separate from any conversion, so you have two events, apparently.

"the  Roth conversion amount & a normal Roth contribution for 2023."

Exactly.

If something is coded G as nontaxable, you might discover this was from/to a Roth 401(k) or "designated" Roth.

Has your taxpayer been able to learn more about their own retirement participation from their plan administrator?

"I cannot find a worksheet that shows 2023 conversion amount where I can put in the amount converted that will flow to the 8606 Part 2."

Maybe it doesn't have to.

[sly]

It was not from a 401K.  The company gave everyone a choice , take a total distribution or do a conversion to a Roth IRA.  They also told them that the amount converted would be taxable , so that rules out a non-taxable event.  There was no basis in her IRA.

[qbteachmt]

"The company gave everyone a choice , take a total distribution or do a conversion to a Roth IRA."

So right here, your statement confirms this is not from a Traditional IRA. That's where your input is going wrong, then. It is in fact under an employer plan. Were you able to confirm that is a SIMPLE IRA plan? A SEP-IRA?

[sly]

Thanks to everyone for helping me on this conversion matter.  I finally got the client to call her advisor & tell them we needed the 1099R coded 2.   He told her there was no need, it was a non-taxable matter.  But I told her to insist the 5498 shows a taxable conversion.   They finally e-mailed her & said, because I was so adamant on a 1099R they looked into the matter deeper & low and behold, they said they found the 1099R coded 2 under a stack of her documents.  They immediately e-mailed it to her & the whole mess is cleared up.   43 years of doing taxes & never had a situation like this.