form 8606 basis issue

Forum|Forum|2 years ago
February 15, 2024
1 reply
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In 2022, I contributed $6,000 to a traditional IRA and then converted $5,998 to a Roth account (the $2 difference was because my brokerage account charged me some fees from the traditional IRA account that they probably shouldn't have, but that I could never get reimbursed for). Based on that, the line 14 on my form 8606 from 2022 ("your total basis in traditional IRAs for 2022 and earlier years") is $2. I prepared and filed my taxes with TurboTax Premier (Desktop version).

I am now working on my 2023 taxes and TurboTax says that the basis it has transferred from prior years taxes is actually zero, and it requests a brief explanation of why I am changing it to $2.

1- any idea why the discrepancy between what TurboTax says it transferred and my form 8606, or how to find that out?

2- should I actually write an explanation, if nothing has really changed?

3- is that $2 basis something I will have to keep carrying on forever on my 8606 forms?

thank you!

Best answer by DanaB27

If you are plan on doing backdoor Roth every year and you verified that your 2022 Form 8606 line 14 shows the $2 basis then just state that the 2022 Form 8606 line 14 shows $2.

fanfare

Employee

It's best to let that $2 disappear and be done with Form8606

But the form is only sent if you do something.

If you expect further conversions, keep any significant basis.

but $2 is not worth the hassle with TurboTax.

newbie1985Author

Thanks!

Unfortunately I will continue to do backdoor Roth conversions and will need to keep filing form 8606.

Could I just file it with zero for basis (since $2 is such a small spine of money)?

DanaB27Answer

If you are plan on doing backdoor Roth every year and you verified that your 2022 Form 8606 line 14 shows the $2 basis then just state that the 2022 Form 8606 line 14 shows $2.

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