Key Points

• Learn how to perform a backdoor Roth IRA using TurboTax.
• Understand the importance of Form 8606 for reporting non-deductible contributions.
• Step-by-step guidance on converting a traditional IRA to a Roth IRA.

Introduction

In this video, the presenter explains how to execute a backdoor Roth IRA within TurboTax, starting with selecting the appropriate deductions and credits section here.

Steps to Execute a Backdoor Roth IRA

• Navigate to the Deductions and Credits section in TurboTax here.
• Select Traditional IRA and check the box for non-deductible contributions here.
• Understand the income limits for direct Roth contributions, which are $228,000 for married couples and $153,000 for singles here.

Contribution Limits

• The maximum contribution is $6,000 for 2022 and $6,500 for 2023, with an additional $1,000 catch-up for those over 50 here.

Conversion Process

• After contributing to a traditional IRA, convert it to a Roth IRA immediately to avoid taxation on withdrawals here.
• You will receive a Form 1099-R for the conversion, which must be reported in TurboTax here.

Reporting in TurboTax

• Input the 1099-R details in the Wages and Income section here.
• Ensure to check the IRA box to link the contribution and conversion correctly here.

Verification

• Double-check your tax return, especially Form 8606, to confirm the non-deductible contributions and ensure the taxable amount is zero here.

Conclusion

The video concludes with a reminder to review your tax return before filing and encourages viewers to like and subscribe for more TurboTax help here.