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In 2000 I "rolled-over" a 401(k) into a "self-directed" IRA. In the same year I did a partial conversion of the IRA into a ROTH.

Well, as we all know , the market got ugly !

My ROTH was worth MUCH less than at the time of the conversion so I "recharacterized" the ROTH back into the Traditonal IRA in November 2000.

Whew !

I've received two 1099-R forms , one showing the conversion( and a hefty taxable amount ) and the second showing the "recharacterization" without a taxable amount.

My question is : How do I file BOTH of these forms for tax purposes ? I've tried filing the 1099-R with the taxable amount and it got depressing! I can't find a method to file while indicating to the IRS that the transaction is not valid.


ANY help would be appreciated - thanks !

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Drifting,

We are pretty much in the same boat. We converted then recharacterized the whole conversion. Would be nice if the IRS simply had an "Oops, never mind" form.

InParadise
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Inparadise ,


As they say," Misery loves...". LOL


I LIKE your idea about the "Oops" form - until then , hopefully someone will stumble along and help us out .



I've been on the phone trying to find out this morning - no luck thus far.
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I LIKE your idea about the "Oops" form -

Just remember, the "S" in IRS stands for service. They've already thought of this.

You report both the conversion and the recharacterization in Part II of Form 8606. You fudge the number on line 14b so that it equals 14a, thus leading you to a zero on 15b of the 1040. See the 8606 instructions.

Then change partners and dance.

Phil Marti
VITA Volunteer
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Thanks for the reply Phil. Something tells me it won't be quite that easy, though. I'm sure to complicate it.<grin>

Now I just have to wait for the local government to get their 8606 forms in. It's a pretty good bet they won't have the instructions. Thank God for the internet.

InParadise
The price of Paradise is comprised of many small inconveniences.
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Phil ,


THANK YOU , SIR !


Now - if I could only Cha Cha.... :)
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