I Converted From a Traditional IRA to a Roth. How Do I Report It?

 

When you convert a traditional IRA to a Roth IRA, the timing of the reporting is different than when you make IRA contributions. 

  • IRA Conversions — You must complete IRA conversions (from a traditional to a Roth) by Dec. 31 of the calendar year. 
  • IRA Contributions — You can make IRA contributions until your return is due. You can do this for both traditional and Roth IRAs.

Ex: You could make a traditional IRA contribution on April 1, 2020 and designate it as a contribution for your 2019 taxes. On April 5, you could convert your traditional IRA to a Roth IRA. However, the conversion can’t be reported on your 2019 taxes. Because IRA conversions are only reported during the calendar year, you should report it in 2020.

IRA Contribution and IRA Conversion Taxability

If you’re able to make a deductible IRA contribution, you’ll receive a tax benefit on your 2019 return. However, you’ll owe tax on the conversion when you do your 2020 return.

If the contribution to your traditional IRA wasn’t deductible, you’ll only pay tax on the earnings, if any, at the time of the IRA conversion. If you convert your traditional IRA contribution to a Roth IRA quickly, you’ll have less time to accumulate earnings.

Want to know more about IRAs? Review details about IRA conversions and traditional and Roth IRA withdrawal rules and early withdrawal penalties. 

If you need to check in with an expert, our tax pros can help. Simply schedule an appointment and we’ll be happy to help. 

Related Topics

Related Resources

Taxes for Flipping Houses

Learn more about flipping houses tax deductions with the help of H&R Block. We break down what expenses you can deduct when flipping a house here.

Opening An IRA To Reduce Taxes

Lean how opening an IRA can help reduce your tax burden with advice from the tax experts at H&R Block.

How Renting Out Your Extra Bedrooms Affects Your Taxes

Thinking about renting out a room in your home? Learn more about the potential tax implications with the experts at H&R Block.

What Gift of Equity Tax Implications Are There If I Buy a House Below Value?

When someone sells you property for less than full value, it’s considered a gift of equity. Let H&R Block explain why this might have tax implications.