I am trying to reconstruct the basis in one of my traditional IRA accounts, and I realized that in one of my returns from 5 or 6 years ago, I made a nondeductible $5,500 contribution that I mistakenly listed as a Roth IRA contribution in that year's tax return. From searching around, it seems that the way to correct this mistake and have it added to my basis is to send in a form 8606 from that year to the IRS. Some questions that I had were:
1. Do I need to amend my return from that year? It's already past the three year statute of limitations and I don't think it affects the amount of taxes I would have had to pay that year, but I wanted to double-check.
2. What kind of documentation or explanation is needed when I send in the form 8606? Should I write a cover letter explaining my mistake? I also have the form 5498 which says that this was a traditional IRA contribution, so should I include a copy of that in mail?
3. Am I going to get anything back from the IRS, like an official confirmation stating that my basis has indeed increased by 5500?
4. How will this be reflected when I do my taxes next year? Turbotax should already be tracking my basis from previous years, so if there is a page asking me to confirm the amount, I would just manually enter the new & higher amount instead?
5. Finally, is there a way to send this in online, or does it have to be by mail?
