TurboTax said I was missing a form when I tried to file & when I logged in a few days later the error was gone so I filed. Now TurboTax says I have an 8606-T available!

Form 8606 is a form for reporting nondeductible IRAs.  One of the purposes of filing this form is to keep track on your IRA nondeductible contributions to traditional IRAs so that the taxability of your future IRA distribution will be correctly calculated based on your IRA basis ( which are the nondeductible contribution portions).  In addition, you also use it to report other IRA-related transactions where the government needs to track the status of your money—whether it’s been taxed or untaxed. 

·         Take distributions from a Roth IRA ( especially calculate the taxable amount of a nonqualified Roth IRA distribution.)

·         Take distributions from a traditional, SEP or SIMPLE IRA at any time after you have made nondeductible IRA contributions

·         Convert a traditional, SEP or SIMPLE IRA into a Roth IRA

If this form applies to you, please see the followings:

Since you have already submitted your return, at this point, you cannot make any corrections to your tax return.

You have two options: 

If your return got rejected for any reasons, you can return to the program/account to edit the info along with other changes.  You do not need an amendment 1040-X.

If your return has been accepted, please see the following :

You will have to amend your return by filing a Form 1040X.  You should not try to amend your return until it has been fully processed and you have received your refund or your payment has cleared.  If by editing the information does not change the refund or amount you owe, you do not need to submit the amendment. 

Amended returns do not “catch up” to your original return and replace them;  they are processed as two separate returns.  

Amended returns have to be printed and filed by mail.  It can take the IRS up to 12 weeks or longer to process them.   If you are due a larger refund than on your original return, your amended return should only show the difference and you will receive a separate check for it.  If you owe money on your amended return, it will show only the new amount owed, you will have to mail a check with the return. 

https://ttlc.intuit.com/replies/3288565

Just noticed that last year's return had no 8606. I do a back-door Roth each year and this is the first one missing. My TIRA is completely funded with roll-overs, no contributions ever, and ZERO cost basis (no non-deductable).

My AGI was not changed .. the only anomaly with the 1040 is that line 4a in blank, 4b has the distribution. On the 8606, typically only line 16 & 18 are filled in by TT.

I have asked a few forums about this and got three(3) answers ..

One- don't do anything until / unless I hear from the IRS 

Two- mail in 8606 with a note explaining your AGI is unchanged.

Three- file a 1040x and add the 8606

What is you opinion ?  

Option 3 is the correct way to fix this .   Going forward review the entire return carefully before you file. 

" My TIRA is completely funded with roll-overs"

If you have a TIRA with non-zero value and no prior years basis,

you can't do a Backdoor Roth  contribution, by definition.

By "Backdoor" is meant, a permitted conversion to Roth that is tax-free.

If 8606 reports non-deductible and calculates ones cost basis. I don't have either of these. Each year I do Roth conversion(s) and pay income tax on that amount in the quarter(s). I thought that was a back-door Roth. Each year TT adds an 8606 and only fills in lines 16 & 18 in part 2. This past year the 8606 was not added. I just discovered this and have to assume that a mistake was made. The root cause is still a mystery as it probably lies in one of the many questions TT asks in the process. By now the 5498 has been received and if the IRS wants the 8606, they will surely let me know. I'd prefer to get another's reply, since it's clear what Critter thinks. On a side note, is there any way to reduce the badge-er-ing emails ? This is a serious forum and those are just too silly. Appreciate your response.

@RC519 

Did you pay according to the Form 8606 calculation.??

If so, but you did not file Form 8606, (not clear how this could happen) you should do so by attaching it to Form1040-X with an explanation.

That's all there is to it.

If the form  calculation changes your tax due, then you have to file 8606 and any other forms and schedules that changed due to your amendment.

Only lines 16 & 18 are populated with the conversion amount.  Part 1 is never even filled out. No change to taxable income or other forms except 1040 line 4a is blank, 4b alone has conversion. In previous years, 4a is populated, 8606 is always line 16 & 18 only. Once I file the next return (for 2021) won't the missing form be a moot point ? 

The purpose of Form 8606 is to track prior years basis.

Based on what you said you had no prior years basis (no Part I)

or you didn't enter it.

when there is no change to your basis, you don't have to file Form 8606.

If you had a basis but did not enter it, you filed incorrectly.

Thanks .. "when there is no change to your basis, you don't have to file Form 8606" .. sounds good to me.

TT included 8606 in previous years in identical situation (part-2 only & just lines 16 & 18).

Is there a source to back that up ? That would be ideal.  Thanks !

Do you have a prior years basis, or not ??

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@RC519 wrote:

Thanks .. "when there is no change to your basis, you don't have to file Form 8606" .. sounds good to me.

TT included 8606 in previous years in identical situation (part-2 only & just lines 16 & 18).

 

Is there a source to back that up ? That would be ideal.  Thanks !

---

You don't normally enter a 8606 itself. It is automatically created when:

1) You make a new non-deductible Traditional IRA contribution.
2) You take a distribution from a IRA that has a after-tax "basis".
3) You make a conversion of a retirement account to a Roth IRA
4) You have distribution from Roth IRA.


[For more information:
See IRS 8606 instructions
https://www.irs.gov/pub/irs-pdf/i8606.pdf
"Who must file" page 1.]

If none of those occurred, then the last filed 8606 remains in effect

There are some circumstances when a 8606 must be files for other reasons and might require filing a stand-alone 8606.

https://ttlc.intuit.com/questions/1899503-what-is-form-8606-nondeductible-iras-used-for

BTW this post is years out of date.    The 6/6/ 2019 posting date is the date that the  "old" forum was migrated to this new forum so any post with that date can be much older and should not be relied on.  However, the 8606 rules have not changed for many years.

No, never had any basis .. my TIRA has no after-tax content.  Thanks 

It's only been the last few years when I do a Roth conversion that TT generates one with lines 16 & 18 only. This past year was no different except .. for whatever reason .. no 8606 was generates and so I filed without it. Thanks

So I did do a Roth conversion but never had any non-deductible content in the TIRA. I see the conversion in #3 and can only hope that assumes one may have a basis to calculate .. I do not.  So, last years filing for 2020 was missing the 8606 but AGI and taxes due/paid are not changed. The only other anomaly is that the 1040-sr has line 4a blank and line 4b alone has the conversion amount.  Do you think I'm okay to do nothing, should In send in an 8606 alone (with explanation), or in conjunction with a 1040-x. I feel it will become moot after the next filing .. repeating the same process WITH the TT generates 8606 .. still no basis. Perhaps I should fill out part 1 to make it perfectly clear that I have no basis ?

Thoughts ?

The only reason for the 8606 is to report basis ... if you have none the 8606 is not needed.  

Well that sounds great, especially from you because you seemed adamant that I needed to re-file. I now suspect that TT may default to including one because they don't know if one has a basis from prior years. The only outstanding worry I have is reason #3 for when an 8606 is required .. says Roth conversions and nothing about if you have a basis. Any more thoughts ? 

Appreciate the input 

BTW anyone know how to stifle the badging emails ?

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@RC519 wrote:

Well that sounds great, especially from you because you seemed adamant that I needed to re-file. I now suspect that TT may default to including one because they don't know if one has a basis from prior years. The only outstanding worry I have is reason #3 for when an 8606 is required .. says Roth conversions and nothing about if you have a basis. Any more thoughts ? 

Appreciate the input 

 

BTW anyone know how to stifle the badging emails ?

---

Basis is *one* of the reasons to file a 8606.   *ALL* Roth *conversions* are reported on a 8606 - basis or not.

You don't normally enter a 8606 itself. It is automatically created when:

1) You make a new non-deductible Traditional IRA contribution.
2) You take a distribution from a IRA that has a after-tax "basis".
3) You make a conversion of a retirement account to a Roth IRA
4) You have distribution from Roth IRA.


[For more information:
See IRS 8606 instructions
https://www.irs.gov/pub/irs-pdf/i8606.pdf
"Who must file" page 1.]

[quote from IRS instructions]
Who Must File
File Form 8606 if any of the following
apply.
• You made nondeductible
contributions to a traditional IRA for
2020, including a repayment of a
qualified disaster or reservist
distribution.
• You received distributions from a
traditional, SEP, or SIMPLE IRA in 2020
and your basis in these IRAs is more
than zero. For this purpose, a
distribution doesn’t include a distribution
that is rolled over (other than a
repayment of a qualified disaster
distribution (see 2020 Forms 8915-C,
8915-D, and 8915-E)), qualified
charitable distribution, one-time
distribution to fund an HSA, conversion,
recharacterization, or return of certain
contributions.
• You or your spouse transferred all or
part of their traditional, SEP, or SIMPLE
IRA in 2020 to the other spouse under a
divorce or separation agreement where

the transfer resulted in a change in the
basis of the IRA of either spouse.
• You converted an amount from a
traditional, SEP, or SIMPLE IRA to a
Roth IRA in 2020.
• You received distributions from a
Roth IRA in 2020 (other than a rollover,
recharacterization, or return of certain
contributions—see the instructions for
Part III, later).
• You received a distribution from an
inherited traditional, SEP, or SIMPLE
IRA that has a basis, or you received a
distribution from an inherited Roth IRA
that wasn’t a qualified distribution. You
may need to file more than one Form
8606. See IRA with basis under What if
You Inherit an IRA? in Pub. 590-B for
more information.

So what action do you suggest .. file a 1040-x and submit 8606, send in a 8606 alone, wait to hear from IRS ? It seems to me to be a technicality at this point, nothing to be gained by either party except punish me for not "complying" and get their $50 (my penalty). I'm leaning toward the wait and see.  

what we've ( @Critter-3  and myself) been trying to say is:

There is nothing for you to do !

Thanks to you both. 

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@RC519 wrote:

So my missing 8606 is really not a problem because I have no basis. My 1040-sr line 4a is blank but should be same as 4b since I converted the entire distribution.

 

Moving fwd, TT generated forms .. 1)1099-r additional distr info which had no check in B5 to indicate entire distr was converted.  [BTW- once I did check (form mode) 8606 was added, 1040 4a,4b agree]

2) IRA additional info W/S .. did not include 2020 conversion until checking aforementioned B5.

 

When I start my 2021 return, how can I ensure TT starts with my modified 2020 file vs what I filed ? 

 

Appreciate that insight, thanks.

---

You seem to have ignored my prior post with the 8606 rules.

I suggest that you amend 2020 - delete the 1099-R all together and re-enter saying that you converted the money.

That should produce a 1040 with the amount on 4a ans 4b and a 8606 with lines 16 & 18.

I did ignore because I chose to go with the other two, one of which had shared your opinion originally.

So you answered the background info and ignored my question about how to start next years return in such a way that it'll include the conversion not shown in this years return. 

BTW - I think IRS says if you are missing a form, wait until they ask for it.

BTW - What is the cost to refile .. would I do that thru TT as an E-file OR mail it in, etc. I never did it.

(I think the real cost is awakening a giant .. asking for more trouble than this is worth)  

When TT makes a mistake, do I get to re-file for free ? do they pay the fine ? I know the assumption is it was my mistake and it probably was .. just curious. 

So, moving FWD from here .. how does TT decide which file to copy & start with for my 2021 ?

Can I choose or rename to control ?

I now have a modified version in addition to the filed version. The modified version is preferred because it'll include the 2020 conversion in the forms that are for my records .. such as the IRA additional info W/S.  ?

Appreciate your input

you're really struggling with a non-problem.

all this has no effect on your 2021 tax return.

Just proceed normally.

Note: if you you use Forms Mode, you become liable to get anomalous results. For that reason,  it's use is discouraged by some on this forum.