Nondeductible traditional IRA contributions are reported on the Form 8606 for the year for which the contribution is made. Separately, Roth conversions are reported on the Form 8606 for the in which the distribution that is converted to Roth is made. If you make a nondeductible contribution and do not convert or otherwise distribute it in the same year, the entire amount of the nondeductible contribution will be included on Form 8606 line 14 for carryforward to line 2 of the Form 8606 for the future year in which the the Roth conversion is eventually done. If there are no investment gains or losses and there are no other amounts in your traditional IRAs, the entire amount of the basis in nondeductible contributions will be applied to reduce the taxable amount of the conversion to zero no matter how may years you wait.
Let's say that you begin with no money in traditional IRAs, then in 2022 you make a $6,000 nondeductible traditional IRA contribution for 2021, make a $6,000 nondeductible traditional IRA contribution for 2022, then convert the entire $12,000 to Roth in 2022. Your 2021 Form 8606 will have $6,000 on lines 1, 3 and 14. Your 2022 Form 8606 will have $6,000 on line 1, $6,000 (from the 2021 Form 8606) on line 2, $12,000 on lines 3, 5, 13, 16 and 17, $0 on line 14 and taxable amount of $0 on line 18.
