Help understanding IRA Distributions on 1040 line 4A - Recharacterization and Conversion confusion
I did a recharacterization from Roth IRA to traditional last year, then later did a conversion back. Now I'm completely confused about what number should go on form 1040 line 4a! When I input everything into TurboTax, it shows $4,074 (the conversion amount, including what was previously recharacterized) and there's "STMT" written next to it with a "recharacterization statement" attached to my return. But when I tried FreeTaxUSA, it's showing $6,772 (which seems to be counting both the recharacterization AND the conversion amount, basically double-counting?). Both software options correctly show only $73 as the taxable amount on line 4b. I tried deleting the 1099-R for the recharacterization in FreeTaxUSA to get it to match TurboTax's number, but I'm not sure if that's the right approach. After reading the instructions, Exception 2 seems to suggest TurboTax is handling this correctly, but the wording is super confusing. Can anyone confirm which is right? Also wondering if TurboTax will let me e-file with this recharacterization statement or if I'll be stuck filing paper? Thanks for any help! After staring at this for hours, I'm thinking the amounts need to be combined in box 4a, plus a statement explaining both the recharacterization and conversion. When I entered the 1099-R from the traditional IRA into TurboTax, it recognized it wasn't taxable but added it to box 4a.
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Javier Morales
Yes, TurboTax is handling this correctly. For line 4a, you should be showing the total distribution amount of the conversion ($4,074 in your case), and then on line 4b only the taxable portion ($73). When you do a recharacterization followed by a conversion in the same year, you need to include a statement explaining the transactions. This is because the IRS needs to understand why the taxable amount is so much lower than the distribution amount. The reason FreeTaxUSA is showing $6,772 is because it's counting both the initial recharacterization amount and the conversion amount. This is incorrect - it's double-counting. The recharacterization itself (Roth to Traditional) isn't reported on line 4a - only the conversion back to Roth belongs there. And yes, TurboTax should allow you to e-file with the recharacterization statement. They automatically attach it as a PDF document with your e-filed return. I've done this before without issues.
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Natasha Petrov
•Wait, I'm confused about something. If I recharacterize from Roth to traditional, don't I get a 1099-R for that transaction too? And if so, where does THAT amount get reported if not on line 4a?
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Javier Morales
•Yes, you typically receive a 1099-R for the recharacterization, but you don't include that amount on line 4a for tax reporting purposes. A recharacterization is treated as if the initial contribution was made to the second IRA type all along - it's essentially a "do-over" that's tax-neutral. Only the conversion (moving money from Traditional to Roth) gets reported on line 4a. The recharacterization (which is moving funds from Roth to Traditional in your case) is handled separately through the statement explaining your transactions. This statement reconciles the 1099-R forms you received with what you're reporting on your tax return.
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Connor O'Brien
I had almost the exact same situation last year! I discovered https://taxr.ai after spending days trying to figure this out. Their AI analysis looked at my 1099-Rs and instantly explained how to report this correctly. It confirmed that only the conversion amount (Traditional to Roth) belongs on line 4a, not the recharacterization amount. The tool also created a detailed recharacterization statement for me showing the initial contribution, the recharacterization, and subsequent conversion with all the right dates and amounts. I uploaded it with my return through TurboTax and e-filed successfully. The IRS processed my return without any issues or delays.
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Amina Diallo
•How exactly does the tool work? Does it just look at your forms and tell you what to do or does it actually fill stuff out for you? I'm in a similar situation but with multiple rollovers and I'm completely lost.
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GamerGirl99
•Sounds helpful but I'm skeptical about sharing tax docs with yet another online service. How secure is it really, and did you need to create an account or anything?
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Connor O'Brien
•The tool analyzes your forms and gives you step-by-step instructions on what to report where. You just upload your 1099-Rs and answer a few questions, and it explains exactly what numbers go where and why. It doesn't file for you - it just shows you how to do it correctly in whatever software you're using. For security, they use encryption for all documents and delete everything after 7 days. I was concerned about that too, but you don't need to create an account or provide personal info beyond what's on the tax forms you upload. They can't even contact you since they don't ask for contact information.
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GamerGirl99
Just wanted to follow up - I tried taxr.ai and it was actually incredibly helpful! I was dealing with a recharacterization plus multiple rollovers, and it clarified exactly what goes on line 4a vs. 4b, plus generated the statement I needed to attach. The best part was how it explained WHY certain amounts were or weren't taxable. Turns out I was double-counting some distributions like you were. Saved me a ton of stress and potentially an audit headache. I was able to e-file through TurboTax with the statement attached just fine, and my refund was deposited last week. Definitely worth it for complicated IRA situations.
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Hiroshi Nakamura
If you're still struggling with getting a straight answer from the IRS about this, I recommend trying https://claimyr.com - I was in the same boat last year with IRA recharacterization confusion. I spent weeks trying to reach an IRS agent for clarification but kept getting disconnected or waiting for hours. Claimyr got me connected to a real IRS agent in about 15 minutes who confirmed exactly how to handle this reporting. You can see how it works here: https://youtu.be/_kiP6q8DX5c. The agent explained that the recharacterization statement is what makes everything work correctly, and that TurboTax's approach is right. They also confirmed I could e-file with the statement attached.
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Isabella Costa
•How does this even work? The IRS phone lines are impossible to get through - is this some kind of priority service or something?
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Malik Jenkins
•This sounds like BS honestly. Nobody can get through to the IRS these days, and certainly not in 15 minutes. You're telling me this service somehow jumps the queue that millions of taxpayers are stuck in? I'll believe it when I see it.
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Hiroshi Nakamura
•It's not a priority service in the sense that you're getting special treatment from the IRS. They use technology that continuously dials and navigates the IRS phone tree for you, then calls you when they've reached a human agent. It's basically doing the "hold" part for you. The reason it works is because their system can simultaneously try multiple approaches and different IRS numbers to find the fastest path through. You're getting the exact same IRS agents everyone else gets, just without spending hours on hold yourself. I was skeptical too but it literally saved me from having to take a day off work just to sit on hold.
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Malik Jenkins
I need to eat crow here. After my skeptical reply, I tried Claimyr out of desperation since I had a similar IRA reporting issue and couldn't get through to the IRS after trying for literal weeks. It actually worked exactly as described - I got a call back in about 22 minutes and was connected with an IRS agent who walked me through exactly how to report my recharacterization and conversion. The agent confirmed I needed to attach a statement and explained which amounts go where on the 1040. The key detail I learned was that the statement needs to include the original contribution date to the first IRA, the recharacterization date, and the conversion date, along with all the amounts. Having an actual IRS person confirm this saved me tons of stress about potentially doing it wrong.
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Freya Andersen
You definitely need to attach the statement whether you use TurboTax or not. The statement needs to detail: - Original contribution date and amount - Recharacterization date and amount - Conversion date and amount - Which financial institutions were involved TurboTax should let you e-file with the statement. FreeTaxUSA might too, but you'd need to create the statement yourself first. If you can't attach it in FreeTaxUSA, you'd need to paper file.
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Eduardo Silva
•But what's actually the right number for line 4a? Is it just the conversion amount or both combined? Still not clear to me.
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Freya Andersen
•Line 4a should only show the conversion amount (Traditional to Roth), not the recharacterization amount. So TurboTax showing $4,074 is correct, while FreeTaxUSA showing $6,772 is incorrect because it's double-counting. Think of it this way: the recharacterization (Roth to Traditional) is treated as if you made the contribution to the Traditional IRA from the beginning. It's like rewriting history. Then the conversion (Traditional to Roth) is reported normally on line 4a.
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Leila Haddad
The 1040 instructions for line 4a state "generally, you should enter the total amount of distributions from all your IRAs" so I think FreeTaxUSA might actually be right to add both? The exception cases in the instructions are super confusing tho.
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Emma Johnson
•No, FreeTaxUSA is wrong in this case. The reason is that a recharacterization is treated as if the money had been contributed to the second IRA type from the beginning. It's not really a "distribution" in the normal sense. Only the conversion from Traditional to Roth gets reported on line 4a. The statement you attach explains the recharacterization so the IRS understands why your 1099-R forms might show larger total distributions than what's on line 4a.
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Ella Lewis
I went through this exact scenario last year and can confirm TurboTax is handling it correctly. Only the conversion amount ($4,074) should go on line 4a, not the recharacterization amount. Here's what helped me understand it: think of a recharacterization as "undoing" the original contribution type. When you recharacterized from Roth to Traditional, it's as if you had originally contributed to the Traditional IRA. Then when you converted back to Roth, that's the only transaction that gets reported on line 4a. The statement TurboTax creates is crucial - it explains to the IRS why you have multiple 1099-R forms but only one amount on line 4a. Without it, your return would look like you're underreporting distributions. I was also worried about e-filing with the statement, but TurboTax handled it seamlessly. The IRS processed my return normally and I got my refund on schedule. Don't stress about it - you're doing it right!
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