Thanks macuser_22 once again. Yes, line 40 shows the combination of both my wife's and mine's 1099-Rs box 1 amounts.
One last question for you - for my wife all started back in 2018 when we moved from Fidelity 401K to Merrill trad IRA. Her Fidelity account had around 3K. Merrill needed at least 5.5K to allow for the transaction, so we put $2.5 from our "pockets". This amount grew up to 7.5K which is part of the transaction that I have mentioned from the beginning as to what came from trad IRA at Merrill to Roth at Vanguard. I have been stating that we should paid taxes for the whole 7.5K, but in all reality looking at this closer we should have to pay taxes on 7.5K - 2.5K = 5K, right?
By looking at my wife's Merrill old account I recently found a form 5498 for 2018. We didn't get this on the mail from my recollection, so I was just thinking to eat the tax, which I don't think is a good idea anymore. Form 5498 shows line for IRA contributions as $ 2.5K indeed.
I never filled out form 8606 for 2018 taxes, but I do think I need to go back and do it now. I will also need to amend my wife's form 8606 for 2020 taxes as that was part of a backdoor. All in all I have done this manually. For 2018 form 8606 shows line 14 with the 2.5K. For 2020 form 8606 shows line 14 as 9,500. This will go in line 2 of form 8606 for 2021 taxes. This makes line 4b of 1040 show 5K which is this amount from where we should pay taxes on.
The math is working in TT and I think this makes sense, but would appreciate your thoughts as always please.
We will have to pay to the Fed, and one of the two states. I am a bit worried on filing electronically as I would like to make sure that the IRS sees the corrected 8606 forms beforehand or at the same time. Any last suggestions here?
Kind regards,
Ozzie
