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Financial Planning / Tax Strategies
|Subject: Converted Just One of Two IRAs to a Roth||Date: 6/24/2013 1:27 AM|
|Author: IMBonzi||Number: 118742 of 125206|
After learning that having two IRA accounts and converting only one of them to a Roth creates ongoing tax problems, I recharacterized the IRA contributory to Roth conversion that I made in 2012. Unfortunately I learned about the problem at the last minute and, though I gave online instructions to my broker to transfer the money back to my IRA before April 15, 2013, the transfer was not completed until April 15th. I received a Form 5498 for the IRA to Roth conversion.
Turbotax does not seem to recognize the problem of converting just one of two IRA accounts to a Roth. It must recognize that something is wrong, however, because it tells me I will have to pay a penalty for having too much income to have made the conversion in the first place. I contacted Turbotax, but neither of two TT representatives I spoke to was able to keep TT from indicating I have to pay a penalty for the conversion and neither was aware of the arcane two IRAs problem, which I also was unaware of when speaking to them.
Should I manually fill out the 8606 as I have in other years when making an IRA to Roth conversion before having two IRAs (the second came about this year as a conversion from a retirement plan).
Can I avoid the IRS assessing me an added tax resulting from the conversion that didn’t get recharacterized before April 15th?
Thanks, ever so much for any help.
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