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bencpwx
New Member

Calculation of traditional IRA basis after converting to Roth

Still not sure how to calculate the IRA basis. 
- Here is the scenario:  only started IRA contribution 3 years ago. Non-deductible due to income above limit. File jointly each year. contribute to IRA $5500 each year for both me and wife, then converted the full amount $5500 to Roth in the same year, resulting in the beginning of the next year, the balance in traditional IRA account is always 0. 

2014: nondeductible contribution to traditional IRA $5500. contributed and converted to Roth in 2014
2015:  nondeductible contribution to traditional IRA $5500. contributed and converted to Roth in 2015
2016:  nondeductible contribution to traditional IRA $5500. contributed and converted to Roth in 2016

So, what is the traditional IRA basis for 2014, 2015 and 2016?

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1 Reply
DDollar
Expert Alumni

Calculation of traditional IRA basis after converting to Roth

The basis in your Traditional IRA right after you made your contribution each year was $5,500.  As soon as you did the Roth conversion, your Basis  went to zero. So, as of December 31 of each year, your Traditional IRA had a basis of Zero.

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