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Did not file form 8606 in prior years

Forum|Forum|7 years ago
June 4, 2019
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what do i need to do to report my basis if i never filled out form 8606

TurboTax Deluxe Windows

Best answer by re2boys

If you made a non-deductible contribution ( and in fact did not take any deduction on prior year tax returns ) and failed to file a Form 8606, you will need to go back and file a Form 8606 for each year this happened. Be sure to get the proper 8606 for each year. The information for each years 8606 is based upon information filed on the previous years 8606, if any, so you must start with the first year you made these non-deductible contributions and work your way to the present time. Recommend you take care of this immediately before you take any distributions. If taken distributions, those tax returns will need to be amended to properly show carryover of basis from year to year.

Per the instructions, you may be subject to a $50 penalty for each year in question for failure to file the form. You may wish to include backup material such as you yearly Form 5498 and statements that show that the non-deductible contributions were made.

See the instructions for Form 8606: https://www.irs.gov/pub/irs-pdf/i8606.pdf

R

re2boysAnswer

Employee

If you made a non-deductible contribution ( and in fact did not take any deduction on prior year tax returns ) and failed to file a Form 8606, you will need to go back and file a Form 8606 for each year this happened. Be sure to get the proper 8606 for each year. The information for each years 8606 is based upon information filed on the previous years 8606, if any, so you must start with the first year you made these non-deductible contributions and work your way to the present time. Recommend you take care of this immediately before you take any distributions. If taken distributions, those tax returns will need to be amended to properly show carryover of basis from year to year.

Per the instructions, you may be subject to a $50 penalty for each year in question for failure to file the form. You may wish to include backup material such as you yearly Form 5498 and statements that show that the non-deductible contributions were made.

See the instructions for Form 8606: https://www.irs.gov/pub/irs-pdf/i8606.pdf

D

dmertz

Employee

Forms 5498 will show that contributions were made, but that will need to be combined with the corresponding year's tax return to establish that no deduction was taken for the contribution. This is probably why the IRS charges a $50 penalty for Forms 8606 filed late, to recoup the cost of verifying that a nondeductible contribution was actually made.

P

PopPopBilly2810

As background, we've been using Turbo Tax for many years to file our taxes. My wife opened a Traditional IRA in 2014 and made non-deductible contributions to it. Form 8606 was included in our Turbo Tax filing for 2014 and was correctly filled out. However, Form 8606 was not included in our 2015 Turbo Tax filing even though non-deductible contributions were made to that IRA in 2015. This also happened in 2018. Form 8606 was included in our TurboTax filings for 2016, 2017, and 2019, but Turbo Tax entered $0 on line 2 (Basis) on each of these Forms (not sure why). No additional non-deductible contributions were made to this IRA after 2019. We need to establish Basis for this Traditional IRA as my wife has done a Roth Conversion on the entire IRA recently, and we will need to submit a Form 8606 as part of our 2022 Tax Return. I assume that we will need to mail Form 8606 for the years 2015 through 2019 to the IRS, and pay a $250 penalty ($50 per year).

My questions ...

How do we determine which IRS Office to mail these Forms to?

How do I ensure that Turbo Tax gets this right when we do our taxes for 2022?

What additional supporting documents should we submit to the IRS with the Forms 8606?

Please advise. Thanks.