You must amend the 2019 tax return to obtain any refund of the excess taxes paid or to have it credited toward your 2020 tax liability. You must also amend 2019 to properly calculate the reduced basis that carries forward from 2019 Form 8606 line 14 to 2020 Form 8606 line 2. This amendment also need to include an explanation of the adjustment that you must make to the amount on line 2 of the 2019 Form 8606 to account for the after-tax basis that his IRAs acquired from the 401(k).
Using TurboTax, the amendment to the 2019 tax return must be done before beginning your 2020 tax return in 2020 TurboTax so that this carryforward will be correct by transferring in from the amended 2019 tax return to begin the 2020 tax return. If you instead try to adjust the carryforward amount in 2020 TurboTax after beginning the 2020 tax return by transferring in the original 2019 tax file, 2020 TurboTax will ask for an explanation statement for the adjustment to IRA basis to be included with your 2020 tax return. This is inappropriate since the the adjustment and explanation statement are required to be part of the 2019 tax return, not the 2020 tax return.
Failing to file an amended 2019 tax return does not permit you to carry forward to 2020 the basis that was to be applied to the 2019 Roth conversion; you are not permitted to choose what years you use the basis. The basis was reduced by the 2019 Roth conversion whether included on the 2019 tax return or not. I suppose you could do the adjustment on the 2020 tax return without amending 2019, but line 2 of the 2020 Form 8606 must be the reduced basis amount whether you amend or not and your explanation statement required to be included with the 2020 tax return would be more complicated than the one that would be required with the 2019 amendment. Failing to amend the 2019 tax return would simply mean that you would have paid more tax for 2019 than necessary with no way to recover that.
