dmertz
Level 15

Retirement tax questions

The instruction printed on Form 8606 above line 4 says not to make an entry on line 4 and any other following lines other than line 14 if there were no regular traditional IRA distributions or Roth conversions reportable on Form 8606.  Only lines 1, 2, 3 and 14 are used to record the addition to your basis.

 

If you had no regular traditional IRA distributions or Roth conversions reportable on Form 8606, line 4 is not used since it only pertains to calculating the taxable and nontaxable amounts of distributions and Roth conversions.

 

Your Roth conversions made in 2019 were reportable on your 2019 tax return and it's your 2019 Form 8606 that would need to show on line 4 any contributions made for 2019 in 2020.

 

The lack of any ability to help you calculate the taxable amounts of distributions from inherited traditional IRAs is one of TurboTax's shortcomings.  The only instruction provided by TurboTax is to calculate it yourself based on the same method as is implemented on Form 8606 for your own IRAs.  There cannot be any new contributions to an inherited IRA, so lines 1 and 4 will always be blank, making things a bit simpler.

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