When you convert your funds from a traditional IRA to a Roth IRA you should receive form 1099-R from the financial institution. Since a conversion to a Roth is a taxable event, the distribution will be taxable and included in your income. To enter form 1099-R go to:
- Federal Section
- Income
- 1099-R, RRB-1099, RRB-1099-R, SSA-1099
- Add or edit 1099-R
After you enter form 1099-R, you need to navigate to Form 8606 to report your conversion amount. To find form 8606 go to:
- Federal Section
- Deductions
- Adjustments to Income
- Nondeductible IRAs Form 8606
- Enter your converted amount under “Net amount converted from traditional, SEP, and SIMPLE IRAs to Roth IRAs in 2020”
Please keep in mind that Form 8606 is informational only and will not change the calculation of your return. If you need to adjust the taxable amount from any distribution you will need to manually adjust your 1099-R entry.