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Did I forget to file 8606?

Posted: Sat Feb 02, 2019 9:06 pm
by whiteorgo
Hello, longtime lurker and kind of a newb at taxes, so I figure you smart people on this forum will be the best source of help.

I started backdoor roth for the first time back in January 2018. Back then, I put $5,500 into Traditional IRA (for tax year 2017) and immediately converted to Roth IRA. I also did the same thing couple days after for tax year 2018.

Now I'm looking at at my tax report for year 2017, and I realized I don't have the form 8606. Based on what I explained above, was I supposed to file 8606 for tax year 2017?

And also for tax year 2018, when I'm filing my taxes, is my "basis carried over from prior years" now $5,500 from my situation even though I didn't file 8606 last year?

Just very confused so any clarification would be greatly appreciated. Thanks so much!

Re: Did I forget to file 8606?

Posted: Sat Feb 02, 2019 10:53 pm
by Duckie
whiteorgo wrote:Based on what I explained above, was I supposed to file 8606 for tax year 2017?
Yes. In 2018 you made a $5,500 contribution for 2017, so you should have filled out Part I of 2017's Form 8606 for that contribution. You still can. Just download the 2017 form, fill it out and mail it in separately.

If this is the first time you did this it should have:
  • Part I
    Line 1 -- 5,500 (your 2017 contribution made in 2018)
    Line 2 -- 0
    Line 3 -- 5,500
    Line 14 -- 5,500 (your basis which will go on line 2 of your 2018 form)
That's it for 2017.
And also for tax year 2018, when I'm filing my taxes, is my "basis carried over from prior years" now $5,500 from my situation even though I didn't file 8606 last year?
Since you will file the 2017 form before you do your 2018 taxes that will be covered. For your 2018 form here's an example:
  • Part I
    Line 1 -- 5,500 (your 2018 contribution made in 2018)
    Line 2 -- 5,500 (your basis from line 14 last year)
    Line 3 -- 11,000
    Line 4 -- 0 or blank
    Line 5 -- 11,000
    Line 6 -- 0 (this had better be zero, otherwise you're going to be paying a chunk of taxes because of the pro-rata rule)
    Line 7 -- 0 or blank
    Line 8 -- 11,010 (the total amount converted in 2018, this has $10 in converted earnings so you'll see what happens)
    Line 9 -- 11,010
    Line 10 -- 0.99909173 (the more numbers the better)
    Line 11 -- 11,000
    Line 12 -- 0 or blank
    Line 13 -- 11,000
    Line 14 -- 0 (goes on line 2 next time)
    Line 15a -- 0 or blank
    Line 15b -- 0 or blank
    Line 15c -- 0 or blank

    Part II
    Line 16 -- 11,010
    Line 17 -- 11,000
    Line 18 -- 10 (goes on Form 1040 line 4b)
Some software uses a worksheet that skips a bunch of the lines in Part I but as long as as line 14 is 0 and lines 16 through 18 have the right numbers, you're good to go.

Re: Did I forget to file 8606?

Posted: Sat Feb 02, 2019 11:17 pm
by whiteorgo
Duckie wrote:
Sat Feb 02, 2019 10:53 pm
whiteorgo wrote:Based on what I explained above, was I supposed to file 8606 for tax year 2017?
Yes. In 2018 you made a $5,500 contribution for 2017, so you should have filled out Part I of 2017's Form 8606 for that contribution. You still can. Just download the 2017 form, fill it out and mail it in separately.

If this is the first time you did this it should have:
  • Part I
    Line 1 -- 5,500 (your 2017 contribution made in 2018)
    Line 2 -- 0
    Line 3 -- 5,500
    Line 14 -- 5,500 (your basis which will go on line 2 of your 2018 form)
That's it for 2017.
And also for tax year 2018, when I'm filing my taxes, is my "basis carried over from prior years" now $5,500 from my situation even though I didn't file 8606 last year?
Since you will file the 2017 form before you do your 2018 taxes that will be covered. For your 2018 form here's an example:
  • Part I
    Line 1 -- 5,500 (your 2018 contribution made in 2018)
    Line 2 -- 5,500 (your basis from line 14 last year)
    Line 3 -- 11,000
    Line 4 -- 0 or blank
    Line 5 -- 11,000
    Line 6 -- 0 (this had better be zero, otherwise you're going to be paying a chunk of taxes because of the pro-rata rule)
    Line 7 -- 0 or blank
    Line 8 -- 11,010 (the total amount converted in 2018, this has $10 in converted earnings so you'll see what happens)
    Line 9 -- 11,010
    Line 10 -- 0.99909173 (the more numbers the better)
    Line 11 -- 11,000
    Line 12 -- 0 or blank
    Line 13 -- 11,000
    Line 14 -- 0 (goes on line 2 next time)
    Line 15a -- 0 or blank
    Line 15b -- 0 or blank
    Line 15c -- 0 or blank

    Part II
    Line 16 -- 11,010
    Line 17 -- 11,000
    Line 18 -- 10 (goes on Form 1040 line 4b)
Some software uses a worksheet that skips a bunch of the lines in Part I but as long as as line 14 is 0 and lines 16 through 18 have the right numbers, you're good to go.
wow thank you so much for this detailed response. It makes so much more sense. Thank you!!!

Re: Did I forget to file 8606?

Posted: Sat Feb 02, 2019 11:42 pm
by Duckie
Re-reading this, I assumed since you were using the backdoor method that your 2017 contribution was non-deductible. If that's not correct, if you did deduct it on your 2017 taxes, that changes things. There will be no 2017 Form 8606 and a 0 on line 2 for your 2018 Form 8606 which will change all subsequent numbers.

Re: Did I forget to file 8606?

Posted: Mon Feb 04, 2019 4:55 pm
by whiteorgo
Duckie wrote:
Sat Feb 02, 2019 11:42 pm
Re-reading this, I assumed since you were using the backdoor method that your 2017 contribution was non-deductible. If that's not correct, if you did deduct it on your 2017 taxes, that changes things. There will be no 2017 Form 8606 and a 0 on line 2 for your 2018 Form 8606 which will change all subsequent numbers.
Yes, it was definitely non-deductible so I believe your first response was correct. Thanks so much!

Re: Did I forget to file 8606?

Posted: Sun Feb 10, 2019 8:19 am
by cruisefan
I hope it's ok if I ask for a check of my 8606 in this thread instead of starting a new one. I have been looking for info on contributions done for a previous year with the conversion done in the current year.
This thread has the answers I need although there are a few differences (years 2018/2019, over age 50 amount of 6500, my first contribution was non deductible and was only needed once, I'll be able to contribute directly to Roth for 2019 ).

I'm pretty sure that I do only part 1 for 2018 taxes and only part 2 for 2019, although I went through it and changed part 1 with my numbers just in case

Thanks so much

Duckie wrote:
Sat Feb 02, 2019 10:53 pm

If this is the first time you did this it should have:
  • Part I
    Line 1 -- 6,500 (your 2018 contribution made in 2019)
    Line 2 -- 0
    Line 3 -- 6,500
    Line 14 -- 6,500 (your basis which will go on line 2 of your 2018 form)
That's it for 2018.


Since you will file the 2018 form before you do your 2019 taxes that will be covered. For your 2019 form here's an example:
  • Part I
    Line 1 -- 0 (your 2018 contribution made in 2018)
    Line 2 -- 6,500 (your basis from line 14 last year)
    Line 3 -- 6500
    Line 4 -- 0 or blank
    Line 5 -- 6500
    Line 6 -- 0 (this had better be zero, otherwise you're going to be paying a chunk of taxes because of the pro-rata rule)
    Line 7 -- 0 or blank
    Line 8 -- 6510 (the total amount converted in 2019, this has $10 in converted earnings so you'll see what happens)
    Line 9 -- 6510
    Line 10 -- 0.9984639 (the more numbers the better)
    Line 11 -- 6500
    Line 12 -- 0 or blank
    Line 13 -- 6500
    Line 14 -- 0 (goes on line 2 next time)
    Line 15a -- 0 or blank
    Line 15b -- 0 or blank
    Line 15c -- 0 or blank

    Part II
    Line 16 -- 6510
    Line 17 -- 6500
    Line 18 -- 10 (goes on Form 1040 line 4b)
Some software uses a worksheet that skips a bunch of the lines in Part I but as long as as line 14 is 0 and lines 16 through 18 have the right numbers, you're good to go.

Re: Did I forget to file 8606?

Posted: Sun Feb 10, 2019 6:22 pm
by Duckie
cruisefan wrote:I hope it's ok if I ask for a check of my 8606 in this thread instead of starting a new one. I have been looking for info on contributions done for a previous year with the conversion done in the current year.
<snip>
I'm pretty sure that I do only part 1 for 2018 taxes and only part 2 for 2019, although I went through it and changed part 1 with my numbers just in case
You've got it right.

Re: Did I forget to file 8606?

Posted: Sun Feb 10, 2019 7:29 pm
by cruisefan
Duckie wrote:
Sun Feb 10, 2019 6:22 pm
You've got it right.
Thank you. The way you explained it made it easy to follow

Re: Did I forget to file 8606?

Posted: Sun Feb 10, 2019 7:44 pm
by minesweep
It appears that "whiteorgo" and "cruisfan" found the responses they received to be Just Duckie. :happy