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Category: General Questions

What is an IRA Rollover vs. an IRA Conversion?

It is considered a "rollover" if you are moving an IRA from one company to another. You have 60 days from the time you receive the funds from one company to invest it with another company before it becomes taxable to you.

To make an entry for an IRA Rollover in our program go to:

1. Federal section

2. Enter Myself

3. IRA/Pension and Social Security Benefits

4. Add or Edit an IRA- 1099-R and make your entries and mark the check box in the middle left corner of the screen. It states "Check here if all/part of the distribution was rolled over, and enter the rollover amount."

 

If you "convert" an IRA, you are CHANGING it ("converting it") from a traditional IRA to a ROTH IRA.

To make this entry in our program go to:

1. Federal section

2. Deductions

3. Enter Myself

4. Adjustments

5. Nondeductible IRAs (Form 8606) - make the entry on the line that states "Net amount converted from traditional, SEP, and SIMPLE IRAs to Roth IRAs".