My wife does not have any IRA so her basis is zero. Our combined income exceeds the IRS limit for making a ROTH IRA contribution.
So for my wife, we made a $5.5k contribution for year 2014 on Jan 8, 2015. As soon as the transaction posted, we converted it into a ROTH IRA on Jan 12, 2015.
I am preparing our 2014 tax return using H&R Block 2014 software, and I'm a little confused about reporting this conversion.
I am reading this article as a reference:
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However, what the author is indicating that since the conversion was made on 2015 (although the contribution was for 2014), it should be reported on 2015 tax form (not 2014). My questions:
- Is the above correct? That is, I need to report the conversion on the 2015 tax form?
- If the answer to 1) is yes, then on the 2014 tax form, we just report that we made a non-deductible traditional IRA contribution?
- For 2015, when we do report the conversion, there shouldn't be any tax liability correct? Since we performed the conversion within 4 days and there wasn't any gain/loss during that time period?
Thank you for any help.
Kind regards,