Unless the tax attorney mistakenly thought that this investment was in a nonqualified account (not in an retirement account), I agree with what Mike9241 seems to be implying, this tax attorney needs to get an education on IRAs. Investments in an IRA have no capital basis for the IRA custodian to track because investments in an IRA are not subject to capital-gains treatment.
Regarding basis in nondeductible traditional IRA contributions, a restorative payment to your IRA does not change your basis in nondeductible traditional IRA contributions. Basis in nondeductible traditional IRA contributions is required to be tracked by the participant. IRA custodians have no way to know whether traditional IRA contributions are deductible or nondeductible on your tax return.
