I'm struggling with amending my 2021/2022 returns to add 8606 forms missed and found there was rollover IRA I have had since 2020 with money in it making pro-rata rule applied to 8606 making things even more complicated. Could you help to review my situation?
Here is my situation.
In 2021, I contributed $6k after tax money to TIRA and did Roth conversion.
I had another Rollover IRA(rolled over from 403(b) which is pretax ) account that has $2k.
So the Pro-rata rule applied and 8606 form told me $1500 is taxable for my $6k conversion and $1500 will be my basis carry over to 2022
In 2022, I contribute $6k after tax money to TIRA and did Roth conversion. I forgot to file 8606 so now I’m working on 2022 amend in 2024.
For the form 2022 8606, I took 2021 8606 form line 14, which is $1500, to 2022 8606 form line 2 as a basis carry over from prior year. Then Turbotax ask me 2022 year end value of total IRA account to apply pro-rata rule.
I did convert the whole $6k in TIRA (so 2022 year end balance for TIRA is $0) but still had some money in Rollover IRA at 2022 year end. That was $1100 (I lost money from investing Rollover IRA account during 2022). Entering all this makes this pro-rata calculation to result $0 taxable money for $6k Roth conversion in 2022 (Based on line 18 of 2022 8606)
The calculation I understand is 6000*(1500+6000)/(1100+600) > 6000 so it makes all my $6k Roth conversion non-taxable just as no pro-rata.
I’m wondering if I missed something in my calculation or the input to Turbotax entries ends up being false optimistic result (no pro-rata!). Any advice will be welcomed
Here is my situation.
In 2021, I contributed $6k after tax money to TIRA and did Roth conversion.
I had another Rollover IRA(rolled over from 403(b) which is pretax ) account that has $2k.
So the Pro-rata rule applied and 8606 form told me $1500 is taxable for my $6k conversion and $1500 will be my basis carry over to 2022
In 2022, I contribute $6k after tax money to TIRA and did Roth conversion. I forgot to file 8606 so now I’m working on 2022 amend in 2024.
For the form 2022 8606, I took 2021 8606 form line 14, which is $1500, to 2022 8606 form line 2 as a basis carry over from prior year. Then Turbotax ask me 2022 year end value of total IRA account to apply pro-rata rule.
I did convert the whole $6k in TIRA (so 2022 year end balance for TIRA is $0) but still had some money in Rollover IRA at 2022 year end. That was $1100 (I lost money from investing Rollover IRA account during 2022). Entering all this makes this pro-rata calculation to result $0 taxable money for $6k Roth conversion in 2022 (Based on line 18 of 2022 8606)
The calculation I understand is 6000*(1500+6000)/(1100+600) > 6000 so it makes all my $6k Roth conversion non-taxable just as no pro-rata.
I’m wondering if I missed something in my calculation or the input to Turbotax entries ends up being false optimistic result (no pro-rata!). Any advice will be welcomed
Statistics: Posted by kckoo84 — Wed Mar 06, 2024 12:18 am — Replies 0 — Views 104