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, 2024 and designate it as a contribution for your 2023 taxes. On April 5, you could convert your traditional IRA to a Roth IRA. However, the conversion can’t be reported on your 2023 taxes. Because IRA conversions are only reported during the calendar year, you should report it in 2024.

IRA Contribution and IRA Conversion Taxability

If you’re able to make a deductible IRA contribution, you’ll receive a tax benefit on your 2023 return. However, you’ll owe tax on the conversion when you do your 2024 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.