1> Can a spouse’s SEP IRA contribution convert to Roth IRA same year? She contributed $7,000 in 2024 and convert to Roth in 2024. This conversion will make the $7,000s taxable income. 2> Supporting documents are Form 5498 contribution and Form 1099R? What if the Form 5498 is not ready by 5-31-2025? Normally Form 1099R of 2024 may be ready in 2025 even later. File extension to wait for Form 5498? 3> If 2> is yes, how to decide Form 8606 basis? What if taxpayer never provided supporting doc of the converted backdoor Roth in previous years. She provided with one Form 5498 with Non-deductible about $29k now for her 2024 as supporting doc no Form 1099R. Answers: 1. Yes, she can roll the SEP IRA into a Roth IRA in the same year as her contribution to the SEP, and that is best done with a trustee-to-trustee transfer. 2> Yes, Form 5498 is for the contributions and Form 1099R is for the rollover distribution into a Roth. Advise to file an extension and wait for the Form 5498 to arrive before they complete and file the tax return. 3>If Form 8606 is missing and they had rollover distributions, then they must amend the return to add Form 8606 and account for the ROTH rollover, or else it can cause the entire rollover to be taxable.
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https://www.irs.gov/retirement-plans/retirement-plans-faqs-regarding-iras