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Late last year I mistakenly made a deposit to a regular IRA instead of my Roth.

I conducted a recharacterization and the money was moved from the regular IRA to the Roth..

I received a 1099-R for a distribution of those funds from the regular IRA.

Is this to be expected?

If so, how do I account for this on my tax forms? I hate to think that I'd have to pay tax on this, especially since the initial deposit was from after tax funds.

Do I claim the initial deposit and the distribution so that the tax issue is a wash?

What about the early withdrawal penalty?



Thanks,
Jim
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Late last year I mistakenly made a deposit to a regular IRA instead of my Roth.

I conducted a recharacterization and the money was moved from the regular IRA to the Roth..

I received a 1099-R for a distribution of those funds from the regular IRA.

Is this to be expected?

If so, how do I account for this on my tax forms?


See Example 2 on page 4 of the instructions for Form 8606. The only number that winds up on your return is the 1099-R amount on line 15a.

Phil
Rule Your Retirement Home Fool
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See Example 2 on page 4 of the instructions for Form 8606. The only number that winds up on your return is the 1099-R amount on line 15a.




Thanks!

I didn't know that form existed. I just got the 1099-R on Sat and having just dealt with a "you owe us $14,000" letter, I lost a bit of sleep this weekend.
(broker duplicated many trades in the data they sent to the IRS and gave them a $0 cost basis to boot!)

Always keep good records.



Thanks again,
Jim
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