B-GBPEC, your understanding is correct. Since your traditional IRA contribution will be nondeductible, you'll need for file Form 8606 to report the nondeductible contributions. You'll also need to file Form 8606 whenever you make any subsequent traditional IRA distribution, Roth conversion, or distribution from a Roth IRA if the distribution is nonqualified. There is nothing particularly complicated about Form 8606 calculating the taxable and nontaxable portions of a distribution. To fully document your basis in nondeductible traditional IRA contributions you'll want to retain all of the Form 8606 that you ever file (even if you purge other parts of your tax returns after some time).
