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Level 2
posted Apr 18, 2022 4:41:00 PM

IRA Basis

Let's say that at June 1 2020 my Traditional IRA has a balance of 0.  Then on Feb 1 2021, I make a nondeductible contribution of $6000 and immediately convert it to a Roth.  On Feb 1 2022, I make a nondeductible contribution of $6000 and immediately convert it to a Roth.  What is my traditional IRA basis at Dec 31. 2020 and what is my traditional IRA basis at Dec 31. 2021?

 

Thanks

 

Tom

0 5 850
5 Replies
Expert Alumni
Apr 18, 2022 4:50:53 PM

If the first $6000 is a contribution for tax year 2020, your basis as of 12/31/2020 is $6000. If the 2nd $6k is a contribution for 2021, your basis as of 12/31/2021 is $6k.  

Level 2
Apr 18, 2022 5:07:18 PM

Thank You!

Level 15
Apr 18, 2022 5:13:36 PM

this is all shown on your Form 8606 if you filed it correctly.

Level 2
Apr 18, 2022 7:09:43 PM

I have 2 amounts in Box 14 of my W-2...   414H - $6,61.75  and  PT Med&FSA - $5,375.84...  NJ is taking those amounts and adding them to Box 1, which increases my wages by $11,638.  I know 414H is the State Deferred Pension Plan... Why would NJ pick that up as income?

 

Thanks

 

Tom

Expert Alumni
Apr 18, 2022 7:26:40 PM

We have the same in NY. It is an add-back on state income tax because when you are retired, the pension income is tax-free for your state income tax purposes. It is still taxable for federal purposes, though.