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Themeimeis
New Member

Can someone explain how the total basis in traditional IRAs on Form 8606 should be completed if I have made nondeductible contributions before?

I have been making nondeductible IRA contributions and have not been withdrawing from them. For example, the first time I made a contribution was 2015 for $5500. For 2016, I made another contribution of $5500. In my form 8606 for 2016, is the total basis (line 2), $5500 (because of 2015)? Then in 2017, if I make another contribution, my total basis will be $11000 (because of 2015 and 2016)? 

4 Replies
dmertz
Level 15

Can someone explain how the total basis in traditional IRAs on Form 8606 should be completed if I have made nondeductible contributions before?

2016 Form 8606 line 2 should have the value from line 14 of your 2015 Form 8606.  Line 2 is always to be populated from the your total basis in traditional IRAs for xxxx and earlier years line of your most recent previously filed Form 8606 (usually line 14, but a few years had the line numbered differently).

blueisogrifo
New Member

Can someone explain how the total basis in traditional IRAs on Form 8606 should be completed if I have made nondeductible contributions before?

Does this mean if the 1st time I made a non-deductable IRA contribution and then moved the funds to a Roth account the "basis" on line 2 of the form 8606 would be "zero"?
blueisogrifo
New Member

Can someone explain how the total basis in traditional IRAs on Form 8606 should be completed if I have made nondeductible contributions before?

In other words does this mean that if 2016 was the 1st year I made a non-deductable contribution which was then converted to a Roth, my total basis on line 2 of the form 8606 would be zero?
macuser_22
Level 15

Can someone explain how the total basis in traditional IRAs on Form 8606 should be completed if I have made nondeductible contributions before?

@blueisogrifo - That is correct.  If 2016 was the first non-deductible contribution ever made then line 2 would be zero.  The 2016 non-deducible contribution would be on line 1.  The taxable part (if any) of the Roth conversion would be calculated on lines 6-15 on the 8606.    TurboTax will fill out the 8606 for you when you enter the non-deducible contribution in the IRA contribution section and the 1099-R for the distribution/conversion in the 1099-R interview and answer the questions that it was a Roth conversion.
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
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