Deductions & credits

Yes, you must amend your 2022 return.

 

If you make non-deductible contributions to an IRA, it is your responsibility to file form 8606 to keep track of your basis (after-tax contributions) in the IRA.  You should keep copies of form 8606 for your entire life, this is an important exception to the rule that you can discard tax paperwork after 3 or 7 years.  The first year you make non-deductible contributions, you create a form 8606 to track your basis.  Any year in the future when you make more non-deductible contributions, you use the information from the old form 8606 plus the current year info to make a new form 8606 that tracks your cumulative after-tax basis.  And so on and so on.

 

When you withdraw your retirement funds, a percentage will be tax-free since you paid tax on the contributions, but only if you tracked the non-deductible contributions and can prove it.  The IRS will not track them for you, and the IRS does not have to allow any part of your IRA withdrawal to be tax-free unless you can prove you made non-deductible contributions and properly reported them.  That's why you keep copies of all your 8606s forever.

 

You also need form 8606 to determine the non-taxable portion of any Roth IRA conversion, if you ever do that.

 

Amending your 2022 return will not change your tax owed, but will create form 8606 to document the non-deductible contributions.  You can, if you want, prepare the forms by hand instead of using a tax program–you need form 8606 showing the contributions,  and a form 1040-X showing no overall changes. Make sure you download the correct form 8606 for 2022, and check the amended box at the top.  Or, use a tax program to prepare it for you.