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Form 8606: This is my first year using Turbotax-

Previously did own taxes manually with expeditious use of EXCEL. One of my IRAs was funded in part with after tax money. Since retirement in 2006 I have used Form 8606 to enter on Line 2 the Basis computed (Line 14) for the previous tax year. How does this amount (approx. $3461) get inserted when I am inputting my 1099-R info? 

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4 Replies
DanaB27
Expert Alumni

Form 8606: This is my first year using Turbotax-

During the 1099-R Interview TurboTax will ask if you had nondeductible contributions, there you can enter your basis. Please follow these steps:

 

  1. Click "Federal Taxes" on the top and select "Wages & Income"
  2. Click "I'll choose what to work on"
  3. Scroll down and click "Start" next to "IRA, 401(k), Pension Plan (1099-R)
  4. Answer "Yes" to the question "Did You Have Any of These Types of Income?"
  5. Click "I'll Type it Myself"
  6. Choose "Form 1099-R, Withdrawal of Money from 401(k) Retirement Plans, Pensions, IRAs, etc."
  7. Click "Continue" and enter the information from your 1099-R
  8. Continue through the questions
  9. On the "Your 1099-R Entries" screen click "continue"
  10. Answer "yes" to "Any nondeductible Contribution to your IRA?"
  11. Answer the questions about the basis

 

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dmertz
Level 15

Form 8606: This is my first year using Turbotax-

In online TurboTax the "Your 1099-R Entries" page is instead titled "Review Your 1099-R Items."

Form 8606: This is my first year using Turbotax-

Did that, but do not see a place to insert the number. Should it be considered an after-tax contribution, since nowhere is BASIS specifically mentioned. My wife's IRA also has after-tax contribution resulting from an account after-tax she had while employed. Together we have about $17K of distributions for which taxes were already paid.

dmertz
Level 15

Form 8606: This is my first year using Turbotax-

TurboTax will only ask in that section whether or not you made nondeductible contributions only if you entered a Form 1099-R reporting a distribution from a traditional IRA.  Although that doesn't seem to be the case here, if you received no such distributions in 2020, you'll need to reach this entry page through Deductions & Credits -> Retirement and Investments -> Traditional and Roth IRA Contributions.

 

In your wife's case, the after-tax amount rolled over to her traditional IRAs from the qualified retirement plan needs to be entered as an adjustment to basis on the first Form 8606 that she is otherwise required to file.  That adjustment is made by clicking the EasyGuide button on the page that asks for her basis.

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