Taxpayer and spouse each contributed $6k to a traditional IRA and immediately converted to Roth for the same amount.
MFJ
No other IRA balances.
I understand you must enter the contribution on the IRA contribution worksheet, and then enter the corresponding 1099-R as well.
However, where in the software do you "link" it all together so that there is no deduction, no taxable income from the 1099-R, and that the backdoor conversion is fully recognized?
On the IRA Info Wks for each of them you need to enter $0 as FMV at year end. That should throw all of the $6K basis to offset the 1099-R income.
Having a non-deductible IRA contribution on the 8606 triggers (in the background) that 1099R conversion to be non-taxable, you shouldnt have to do anything special for it to happen.
@Jim-from-Ohio provided these instructions last month
here is how I do it and it works great for me
1. Enter the traditional IRA contribution on the IRA worksheet
2. If then flows naturally to form 8606
3. Enter 1099-R Worksheet, make sure IRA box is checked
4. Scroll down to B-5, check that box that rolled over to Roth
The End
"1. Enter the traditional IRA contribution on the IRA worksheet as nondeductible"
Need that detail.
If they make too much for a deductible IRA and the retirement box is checked on the W-2 worksheet that should make it nondeductible
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