How to report IRA non deductible late contribution?

Forum|Forum|2 years ago
April 12, 2024
2 replies
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I made a late contribution to traditional IRA account $6500 for 2023 in 1/3/2024 and converted to Roth IRA in 1/11/2024. How to report this correctly in turboTax desktop version so that It won't show as taxable income? Thanks!

TurboTax Online

Best answer by dmertz

The $6,500 nondeductible contribution made for 2023 is to be reported on your 2023 tax return and must appear on lines 1 and 4 of Form 8606. What appears on line 14 of this form will carry forward to line 2 of your 2024 Form 8606.

Nothing about the Roth conversion performed on 1/11/2024 is reportable on your 2023 tax return. The Roth conversion is reportable on your 2024 tax return on 2024 Form 8606.

dmertzAnswer

Employee

Nothing about the Roth conversion performed on 1/11/2024 is reportable on your 2023 tax return. The Roth conversion is reportable on your 2024 tax return on 2024 Form 8606.

xiaochiluoAuthor

Thanks for the quick reply! I was wondering in this case, do I need to add substitute 1099 for this contribution in 2023?

Opus 17

Employee

@xiaochiluo wrote:

Thanks for the quick reply! I was wondering in this case, do I need to add substitute 1099 for this contribution in 2023?

No, 1099s are only for withdrawals. If I understand you correctly, that you

1. made a non-deductible contribution in January 2024 that was directed for 2023, and then

2. converted the IRA to a Roth IRA also in 2024

then the only thing you do for 2023 is report the nondeductible contribution, which gets reported on form 8606 which is used to keep track of your nondeductible contributions. Keep a copy of your tax return, including form 8606, after you file. You will need your 2023 form 8606 when you file your 2024 return and report the conversion.

Opus 17

Employee

You can sometimes make retroactive contributions, as you did. However, the conversion happens when it happens (2024 in this case) and can never be retroactive.