Backdoor Roth IRA Conversion

Forum|Forum|2 years ago
March 22, 2024
2 replies
12 views

My client did a backdoor roth IRA conversion this year and line 14 on Form 8606, the "total basis in traditional IRAs for 2023 and earlier years" comes to $1,768. Does this amount carry forward as the basis for next year's 8606? Thank you.

ProSeries Professional

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Just-Lisa-Now-

Intuit Community Champion

Thats the idea, the basis on the 8606 would be used to wipe out the taxability of the 1099R from the conversion.

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qbteachmt

Level 15

"Does this amount carry forward as the basis for next year's 8606?"

This was a pro rata taxable conversion, then? A "backdoor" is done to avoid tax, because it is done on fully nondeductible account balances. When other funds exist in Trad, SIMPLE or SEP, and there is no full conversion (only basis exists), then that would be Backdoor. It seems your taxpayer has the scenario where each conversion will slightly reduce Basis, because each conversion is a % taxable and a % Basis.

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