Retirement tax questions

If you made a non-deductible contribution ( and in fact did not take any deduction on prior year tax returns ) and failed to file a Form 8606, you will need to go back and file a Form 8606 for each year this happened.  Be sure to get the proper 8606 for each year.  The information for each years 8606 is based upon information filed on the previous years 8606, if any, so you must start with  the first year you made these non-deductible contributions and work your way to the present time.  Recommend you take care of this immediately before you take any distributions. If taken distributions, those tax returns will need to be amended to properly show carryover of basis from year to year.


Per the instructions, you may be subject to a $50 penalty for each year in question for failure to file the form.  You may wish to include backup material such as you yearly Form 5498 and statements that show that the non-deductible contributions were made.

See the instructions for Form 8606:  https://www.irs.gov/pub/irs-pdf/i8606.pdf

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