Personal Finance (Not Investing) • Form 8606 question about $1 tIRA basis/TaxSlayer related?

Hello all,

I've gone round and round in circles with the WCI guide to backdoor Roths, forum posts here, and everything I can get my hands on, but clearly something simple is eluding me and I want to understand if it's important.

So...spouse had a small amount ($1725.26) in a tIRA. Rolled it over (converted it? can't remember the right language) to her Roth in mid-December. Then we did a backdoor Roth--so $6500 went in and out before 12/31. Somehow it grew to $6501.89 in the process.

Spouse gets 1099-R from Vanguard with the following: Box 1: $8227.15 Fine, that makes sense as it's the total of the taxable rollover and the backdoor Roth.

In TaxSlayer, I report that in Box 1 and then $1725 in Box 2, since that is what is taxable, and from reading a billion forum posts this seems to be how to deal with this in TaxSlayer. I then put the $6500 amount into the section on nondeductible IRAs.

Form 8606 comes out as follow:
Line 1: 6500
Line 2: blank
Line 3: 6500
Line 4: blank
Line 5: 6500
Lines 6-7: blank
Line 8: 8227
Line 9: 8227
Line 10: 0.790
Line 11: 6499
Line 12: blank
Line 13: 6499
Line 14: 1
Line 15a-c: blank
Line 16: 8227
Line 16: 6499
Line 18: 1728

My main concern is line 14, the $1 basis in the tIRA. Isn't that going to mess things up down the line? I know I'm not understanding something here and am hoping others can jump in and set me straight.

Thanks, as always!

Statistics: Posted by pjs37 — Mon Feb 05, 2024 11:16 pm — Replies 3 — Views 64

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