Late + Incorrect Form 8606 for Traditional IRA

Forum|Forum|4 years ago
May 9, 2022
1 reply
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So, this is a bit of an unfortunate series of events.

1. After filing my 2021 taxes, I realized that this was the first year I claimed my annual $6000 contribution to my traditional IRA on my taxes when I should have been doing that since 2019. This year's taxes had both my partial deduction of $5760 as well as Form 8606. During the filing process, because I misunderstood the instructions, I entered $12,000 in line #2 thinking this was the total I had contributed in the previous years.

2. A few days later, I filed 1040-X for 2019 and 2020 for my previous years' contribution. My 2020 return had the full $6000 eligible, but my 2019 return was another year of partial deductions of $5640. I did not include Form 8606 with my 2019 return.

So at this point, I think I'm looking at a late/missing Form 8606 from 2019 and an incorrect Form 8606 in 2021.

What should my next steps be? Since my error is for the year 2021, should I file an amended 1040-X, even though it doesn't change my refund/or affect the rest of the numbers on my taxes?

My 2019 amended return has been received but not processed yet. Should I mail Form 8606 or wait for my amended return to be processed?

I'm new to the whole IRA thing, so this situation is a mess. The only upside is that there aren't any Roth IRAs or conversions to complicate the situation. Any advice/help is appreciated!

Not A Product Question

fanfare

Level 15

@5060722

If you amended for a partial IRA deduction in 2019, your 1040-X might be sent back to you for missing supporting form - namely Form 8606.

You should mail a corrected, signed 2019 Form 8606 to the same address you filed 1040-X and hope it links up to your 1040-X.

Anonymous

Thank you, @fanfare. I simply didn't attach any Form 8606 at all for 2019 1040-X. So if I mail it in before they amend/process my 2019 taxes, will that cause any issues? I was always told not to do anything like send in a second amended tax return until they've processed my original amended return, so I'm trying to be cautious. I do still have another year before the 3-year limit to 2019 is up, so I'm hoping those 16-20 weeks of processing for my amended return will be done before then. But I have heard of nightmare stories of people's amendments taking > 1 year to process.

I've also decided to send in an 1040-X for 2021 to correct the basis information I had and hope that they don't assess me any penalties, since I didn't take any distributions or do any roth conversions.