After you've saved up to the match in your employer plan and maxed out your IRA, go back to your employer plan. The 2023 annual limit for employee contributions is $22,500 ($30,000 if you're age 50 or older and your plan allows catch-up contributions.)
Contributions for all types of IRAs—Roth, traditional, SEP, and SIMPLE—are reported on Form 5498.
Conversions from a traditional IRA to a Roth IRA are reported on Form 1099‑R.
The distribution code in Box 7 is determined by your age at the time you converted.
Recharacterizations from a Roth IRA to a traditional IRA—and vice versa—are reported on 2 different tax forms:
You'll see an "R" in Box 7 of Form 1099-R.
Although the original contribution or conversion took place in 2021, the recharacterization will be reported for the 2022 tax year.
You'll see an "N" in Box 7 of Form 1099-R.
Since the recharacterization takes place in the 2022 tax year, you'll receive the tax form that reports the transaction in early 2023.
Have questions? Contact us.
*While our specialists are qualified to provide information about Vanguard products and services, they can't provide tax advice. If your tax situation is complex or if you're uncertain about the interpretation of a specific tax law, we recommend that you consult a qualified tax advisor.
