Thank you. Very helpful. Next quandary.
My wife had a company pension plan. This was different than her 401(k). When she retired those pension proceeds were moved to 2 Traditional IRAs (in 2014 & 2015) and were the only funds in those IRAs. Rollover IRAs i guess. Form 8606 says include those rollover IRA values in line 6 when determining end of year value. In 2021 she took a distribution from one of these IRAs. 8606 Line 7 says do not include rollover IRAs in the distribution calculation. How is that accounted for? It will reduce the next year's basis and possibly the value if not accounted for somewhere.
