We decided to file tax ourselves this year because we had many problems with the CPA last year.
We just realized that he didn't put any amount in line 4 on form 8606 last year even $3,000 of the total $5,500 was contributed during Jan-April 2023. As a result, Line 14 the "Total Basis in Traditional IRAs for 2022" is $0 when it should have a value cause some contribution was made during Jan-April 2023.
Based on 2023 1099-R from Fidelity, the distribution (box 1) was $9,530. Since there wasn't basis on line 14 from last year's filing, the high distribution makes Turbotax think that we over-contributed. And the estimated tax we owe go up by so much.
I downloaded a form 8606 (2022 version), and manually ran the numbers as if the CPA didn't make any mistake. We should end with $3,373 in Line 14 as the total basis (the additional $373 was due to the loss from recharacterization).
On my manual rework, both line 15c and 18 "Taxable Amount" show zero because we contributed after tax money (backdoor to Roth). This is same as what's shown on form 8606 last year.
So the questions are...
1. Can we reset the basis?
2. Since there is no change to the "Taxable Amount" , do we need to file an amend 8606 for tax year 2022 to correct the basis?
3. If we have to file an amend 8606, do we file 1040-X? or just 8606 is fine?
Appreciate any feedback here! Thank you.
