Hello, I would like to double check the following case: I've made a $6,000 contribution to a Traditional IRA in January 2022 and converted the whole amount to Roth IRA a week later. The form 1099-R was generated on Jan 21st. TurboTax guideline on backdoor IRA conversion states the following:You should report your conversion for the year you receive this 1099-R:If you received this form in 2021, complete both steps below to report it on your 2021 taxesIf you'll receive this form in 2022, wait to report it on your 2022 taxes. In this case, only complete Step 1 below for your 2021 taxes. You’ll complete both steps next year when filing your taxes for 2022 Do I understand correctly that in my case (with form 1099-R generated on Jan 21st) I don't need to add 1099-R in my 2021 tax return? In this case, form 8606 shows total basis of traditional IRAs of $6,000 in field 14, and doesn't show any conversion happened, as well as field 4a on form 1040 remains blank?

A

Anonymous

Question

Backdoor Roth IRA made in 2022 for tax year 2021

Forum|Forum|3 years ago
October 7, 2022
1 reply
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Hello,

I would like to double check the following case: I've made a $6,000 contribution to a Traditional IRA in January 2022 and converted the whole amount to Roth IRA a week later. The form 1099-R was generated on Jan 21st.

TurboTax guideline on backdoor IRA conversion states the following:

You should report your conversion for the year you receive this 1099-R:

If you received this form in 2021, complete both steps below to report it on your 2021 taxes
If you'll receive this form in 2022, wait to report it on your 2022 taxes. In this case, only complete Step 1 below for your 2021 taxes. You’ll complete both steps next year when filing your taxes for 2022

Do I understand correctly that in my case (with form 1099-R generated on Jan 21st) I don't need to add 1099-R in my 2021 tax return? In this case, form 8606 shows total basis of traditional IRAs of $6,000 in field 14, and doesn't show any conversion happened, as well as field 4a on form 1040 remains blank?

TurboTax Deluxe Online

Hal_Al

Employee

@5116428 said "The form 1099-R was generated on Jan 21st".

Is your 1099-R for 2022 or 2021?

If you converted the money to a Roth in January 2022, you should not receive your 2022 form 1099-R until Jan/Feb 2023. So, what matters is not when the 1099-R was issued; but for what tax year the 1099-R (2021 or 2022) is issued. You plan administrator should not be issuing a 2021 1099-R for a distribution made in 2022. The fact that the contribution was made in 2022 for tax year 2021, does not change that.

Rewording your question:

Q. Do I understand correctly that I don't add a 2022 form1099-R in my 2021 tax return?

A. Yes, that is correct. If, instead, you have a 2021 1099-R, you need to ask your plan administrtor what's going on.

Q. Form 8606 shows total basis of traditional IRAs of $6,000 in field 14, and doesn't show any conversion happened, as well as field 4a on form 1040 remains blank?

A. That's correct.

Critter-3

Since you did not do the "backdoor conversion" in the same tax year as the contribution was for this will be handled on both the 2021 & 2022 returns. The non deductible contribution for the 2021 tax year will be reported on the 2021 form 8606 and then the conversion on the 2022 tax return.