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How do I determine the basis of my IRA if it was opened as a 401K rollover 5 years ago, and has had no contributions since the rollover?

Forum|Forum|7 years ago
June 4, 2019
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I am in the process of converting a Traditional IRA to a Roth IRA (the full amount). I know I will need to complete a Form 8606 to report this conversion, but the form requires a "total basis". The traditional IRA was opened as a rollover approximately 5 years ago, from a 401K after leaving the company. No contributions have been made to the IRA since it was created 5 years ago, but the account has earned interest.
How do I determine the basis of my IRA? Is it simply the full amount of the IRA at the time I converted it? Is it just the amount that was rolled over 5 years ago? Or just the interest earned? Help!

Best answer by MinhT1

The basis of a Traditional IRA is the amount of non-deductible contributions you made to that IRA.

As the IRA was a rollover from your 401(k) plan and you made no contributions since the rollover, the basis is 0. This is because all your contributions to your 401(k) were made with before-tax dollars.

M

MinhT1Answer

The basis of a Traditional IRA is the amount of non-deductible contributions you made to that IRA.

As the IRA was a rollover from your 401(k) plan and you made no contributions since the rollover, the basis is 0. This is because all your contributions to your 401(k) were made with before-tax dollars.

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