Form 8606 has nothing to do with dividends, perhaps you meant contributions.
Entries of traditional IRA contributions on Form 8606 determine how much of the contributions goes on Schedule 1 line 20. When IRA distributions or Roth conversions are being reported on Form 8606, the calculations on Form 8606 determine how much of the distributions being reported on Form 8606 are taxable income to be included on Form 1040 line 4b. Any other effects on Form 1040 flow from the amounts on Schedule 1 line 20 or Form 1040 line 4b.
Because distributions from a traditional IRA are a proportionate mix of nontaxable basis in nondeductible contributions and taxable amounts, Part I of Form 8606 calculates the proportions by taking into account the amounts distributed and the year-end balance in traditional IRAs. IRAs are individual accounts, so each individual has a separate Form 8606 even when married filing jointly.
Part III is used to calculate the taxable amount of nonqualified Roth IRA distributions by applying the ordering rules for Roth IRA distributions.
