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IL_abbmm
March 4, 2024
Solved

Should backdoor IRA's 6.5K amount still show in total income as nontaxable item? It seems it still contributes to tax owed.

  • March 4, 2024
  • 2 replies
  • 0 views
I've input 1099-R following instructions and the 6.5k now shows in total income as a nontaxable item. However, when i review federal income tax, it is the toal income (including backdoor) minus deduction, not total income minus nontaxable minus deduction. Backdoor is not a deductible item in the deduction. So am i paying tax for my backdoor IRA amount?
Best answer by DanaB27

No, nontaxable income will not affect the taxes owed. Please be aware, that the whole distribution will show as income in TurboTax on the summary screen which shows gross income, not taxable income. To verify that the entry is correct please look at form 1040 line 4b (taxable amount).

 

To preview Form 1040:

 

  1. Click on "Tax Tools" in the left menu
  2. Click "Tools"
  3. Click "View Tax Summary" in the Tool Center window
  4. Click on "Preview my 1040" on the left

 

Please see How do I enter a backdoor Roth IRA conversion? for additional information.

2 replies

D
DanaB27Answer
March 4, 2024

No, nontaxable income will not affect the taxes owed. Please be aware, that the whole distribution will show as income in TurboTax on the summary screen which shows gross income, not taxable income. To verify that the entry is correct please look at form 1040 line 4b (taxable amount).

 

To preview Form 1040:

 

  1. Click on "Tax Tools" in the left menu
  2. Click "Tools"
  3. Click "View Tax Summary" in the Tool Center window
  4. Click on "Preview my 1040" on the left

 

Please see How do I enter a backdoor Roth IRA conversion? for additional information.

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    D
    dmertz
    Employee
    March 4, 2024

    Nontaxable income does not affect your taxes owed.

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