reporting roth coversion
I have a client that is making nondeductible contributions to traditional IRA and today she is converting those contributions to a ROTH IRA. The custodian will issue a 1099r showing conversion, how does client confirm or clarify with IRS that the contributions were not deducted and only gains are taxable?
Permalink Submitted by Alan - IRA critic on Tue, 2013-12-31 22:21
The non deductible contributions are reported on Form 8606, the same form that is used to report the conversion. Note that the form requires inclusion of all non Roth IRA accounts to calculate the taxable portion of the conversion, so if she has other such accounts her conversion may be mostly taxable.