Form 8606

[Ghost49]

From 8606

I have a total basis now in a traditional IRA of $19,500 on line 2 & 3 that will be carried forward to 2025 tax return.

I am 75 years old and receive RMD once a year now.

I have filed form 8606 every year that there was a non-deductible contribution into the IRA.

I have copies of those 8606 forms for the years that there was a non-deductible contribution.

At present my RMD is around $7,000 per year and TurboTax calculated the RMD correctly for the previous and future year’s RMD  

The plan for 2025 is to take the combined total of RMD $7,000 + the $19,500 basis line #3 on form 8606 for a combined total of $26,500

The question???

The Basis $19,500 not taxed.

The $7,000 RMD is taxed

 TurboTax

8606 doesn’t address this type of transaction

[DavidD66]

Form 8606 does not address that type of Distribution becuase that type of transaction is not allowed.  When you take a distribution from an IRA with both pretax and after-tax (non-deductible) funds, the distribution is part pretax and part after-tax.  Let's say you have an IRA with a total balance of $100,000, and your basis in the IRA is $19,500.  Any distribution  you take from the IRA will have taxable component (80.5%) and a non-taxable (19.5%) component. If you take a distribution of $7,000 to meet your RMD, then $5,635 will be taxable and $1,365 will be non-taxable.  You cannot take a distribution that is only after-tax (non-deductible).  If you take another distribution of $19,500, then $3,802 will be non-taxable and $15,697 will be taxable.