2011 Reporting for 2010 Roth Rollovers and Conversions
In 2010, you may have:
rolled over eligible distributions from a retirement plan to a Roth IRA,
converted (transferred) amounts from a non-Roth IRA to a Roth IRA, or
made an in-plan Roth rollover (after September 27, 2010).
If so, you must report half of the taxable amount of these 2010 rollovers and conversions on your 2011 income tax return unless you:
elected to include the taxable amount in income for 2010 by filing a 2010 Form 8606, Nondeductible IRAs, (instructions) and completing Part II or Part III or both, as applicable, and checking the box on line 19, the box on line 24 or both;
recharacterized your 2010 rollover or conversion to a Roth IRA (in-plan Roth rollovers can’t be recharacterized); or
received a distribution in 2010 or 2011 of any of the taxable amount (in which case, you may have to report an amount other than half on your 2011 tax return).
No 2010 or 2011 Distributions
If no part of the 2010 conversion to a Roth IRA was distributed in 2010 or 2011, you must report the amount from line 20a of your 2010 Form 8606 on line:
15b of your 2011 Form 1040, U.S. Individual Income Tax Return (instructions);
11b of your 2011 Form 1040A, U.S. Individual Income Tax Return (instructions); or
16b of your 2011 Form 1040NR, U.S. Nonresident Alien Income Tax Return (instructions).
If no part of your 2010 rollover to a Roth IRA (from a retirement plan other than an IRA) or 2010 in-plan Roth rollover was distributed in 2010 or 2011, you must report the amount from line 25a of your 2010 Form 8606 on line:
16b of your 2011 Form 1040,
12b of your 2011 Form 1040A, or
17b of your 2011 Form 1040NR.
On your 2010 tax return, you would have had to report distributions of your 2010 rollovers and conversion to a Roth IRA and in-plan Roth rollovers.
On your 2011 tax return, you must now report:
on Form 1040, line 15b (Form 1040A, line 11b; or Form1040NR, line 16b) the smaller of the:
amount from your 2010 Form 8606, line 20a, or
remaining taxable amount of your 2010 conversions to a Roth IRA; and
on Form 1040, line 16b (Form 1040A, line 12b; or Form 1040NR, line 17b) the smaller of the:
amount from your 2010 Form 8606, line 25a, or
remaining taxable amount of your 2010 rollovers to a Roth IRA and in-plan Roth rollovers.
Example – You converted $30,000 from a traditional IRA to a new Roth IRA on February 1, 2010. On June 1, 2010, you received a $20,000 distribution of the converted amount from the Roth IRA. You completed Part II of the 2010 Form 8606 to report the $30,000 as the taxable amount of the conversion and you elected to include $15,000 of the taxable amount in income for 2011 and $15,000 for 2012. The $30,000 was the only amount you put into your new Roth IRA in 2010, so the entire $20,000 distribution was from the taxable amount of your conversion. You included the $20,000 in your 2010 income by reporting it on line 15b of your 2010 Form 1040.
Only $10,000 of your 2010 conversion remains to be taxed and because this is smaller than the $15,000 you listed on line 20a of your 2010 Form 8606 (half of your total 2010 conversion to a Roth IRA), you must now include $10,000 on line 15b of your 2011 Form 1040. You will not have to report any amount of your 2010 conversion to a Roth IRA in your 2012 income. See Publication 575, Pension and Annuity Income, for additional examples.
You may have to include in 2011 income all or some of the taxable amount of your 2010 rollovers and conversion to a Roth IRA and in-plan Roth rollovers that you would have otherwise included in 2012 income. To determine the amount to report in 2011, complete the 2011 Form 8606 (instructions):