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NON DEDUCTIBLE IRA CONTRIBUTION

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Level 1

Is there a penalty for not filing Form 8606 from 2011 to 2016.  Is there something that I need to do? 

With regards to Part III Traditional IRA Basis Detail #12, what does it mean "Basis for 2018 and earlier years"? Is this the total contributions for the previous years?

Please advise.

Thank you.

 

 

 

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2 Replies 2
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Level 5

Unfortunately this happens all the time.  Either clients don't tell us or if no contribution was made last year the 8606 form doesn't carryover (the basis does if entered), or it's a new client and we have no clue.  I've had to enter a ton of catch-up numbers for this and have never encountered a penalty or even a question from the IRS.  Re your other question, yes, that is where we enter the cumulative nondeductible contributions.  Separately if there is a distribution you will have to also enter the fair market value so you will need 12/31 prior year and 12/31 current year if that happens.

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Level 12

"Is this the total contributions for the previous years?"

No. It's only the Nondeductible amounts contributed for a Traditional IRA. Basis = after-tax funds contributed to the account.

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