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Retirement tax questions
Yes, if you converted the full amount and all your traditional/SEP/SIMPLE IRAs were $0 on December 31, 2022, then the basis on line 14 of your 2022 Form 8606 should be $800 for the example given. You had a $6,000 basis (nondeductible contribution) for 2022 and then converted $5,200 (because you had a loss) and used $5,200 of your basis. Therefore, you should have an $800 basis left.
This $800 basis is carried over to next year, to line 2 of your 2023 Form 8606 (if it isn't carried over you can enter it during the contribution interview or during the retirement distribution interview).
Worksheet Part V (balance carryover to 2023):
- Line 59 should be $0 for the 2022 conversion contribution taxable at conversion and
- Line 60 should be $5,200 for the 2022 conversion not taxable at conversion.
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March 5, 2023
12:52 PM