Hello fellow Bogleheads,
I screwed up our IRA contribution in the 2022 tax year (last year's taxes) as I contributed to my wife and my Roth IRAs (6k to each) in January 2022 and then ended up exceeding the annual income limit by the end of the year. Due to this, before submitting last year's taxes in April of 2023, I recharacterized these contributions as a Traditional IRA contribution then immediately converted right back to a Roth IRA. Essentially, doing the backdoor Roth that I should've done all along.
I'm now doing my taxes for the 2023 tax year, and I'm seeing 3 1099-Rs. 2 of them make sense as I successfully did the Backdoor Roth in the 2023 tax year (knowing this time I'd be above the income limit) and those are non-taxable events in the Roth IRA accounts. However, the 3rd 1099-R is in my Traditional IRA account and has a $11,788 gross distribution and $11,788 taxable amount on my 1099-R (this is the $6k x 2 = $12k minus losses that occurred between when I contributed and the recharacterization to Traditional IRA + conversion to Roth IRA) Image may be NSFW.
Clik here to view.
. Should I be subject to taxes on this? I obviously already paid taxes on the money I put into the Traditional IRA to begin with (as it was originally a Roth IRA contribution with after tax money) and it was then recharacterized and immediately converted to the Roth.
This is my first time dealing with this so apologies if I'm overlooking anything or am being naive. I was under the impression that by recharacterizing the Roth IRA contribution to Traditional IRA, then converting right back to Roth IRA, I would not be subject to taxes (same as a typical backdoor Roth IRA).
Any advice is greatly appreciated here!
I screwed up our IRA contribution in the 2022 tax year (last year's taxes) as I contributed to my wife and my Roth IRAs (6k to each) in January 2022 and then ended up exceeding the annual income limit by the end of the year. Due to this, before submitting last year's taxes in April of 2023, I recharacterized these contributions as a Traditional IRA contribution then immediately converted right back to a Roth IRA. Essentially, doing the backdoor Roth that I should've done all along.
I'm now doing my taxes for the 2023 tax year, and I'm seeing 3 1099-Rs. 2 of them make sense as I successfully did the Backdoor Roth in the 2023 tax year (knowing this time I'd be above the income limit) and those are non-taxable events in the Roth IRA accounts. However, the 3rd 1099-R is in my Traditional IRA account and has a $11,788 gross distribution and $11,788 taxable amount on my 1099-R (this is the $6k x 2 = $12k minus losses that occurred between when I contributed and the recharacterization to Traditional IRA + conversion to Roth IRA) Image may be NSFW.
Clik here to view.
. Should I be subject to taxes on this? I obviously already paid taxes on the money I put into the Traditional IRA to begin with (as it was originally a Roth IRA contribution with after tax money) and it was then recharacterized and immediately converted to the Roth.This is my first time dealing with this so apologies if I'm overlooking anything or am being naive. I was under the impression that by recharacterizing the Roth IRA contribution to Traditional IRA, then converting right back to Roth IRA, I would not be subject to taxes (same as a typical backdoor Roth IRA).
Any advice is greatly appreciated here!
Statistics: Posted by adinvest03 — Wed Mar 20, 2024 7:11 am — Replies 3 — Views 325
