That is great information.If either of you made non-deductible IRA contributions in the past, Form 8606 should have been filed with your tax returns. If you neglected to file Form 8606 but have access to previous tax returns and to your IRA contribution histories, you could check on whether there were years in which you made contributions that would have been non-deductible because your MAGI exceeded the deduction limits. It is possible to file an amended Form 8606 to claim credit for past non-deductible contributions. There's a potential late filing penalty, but I think IRS often waives this. If you made non-deductible contributions in the past that haven't been tracked, the downside is that you will pay income tax again on those contribitions as they're withdrawn either through RMDs or Roth conversions. It's a headache and a bit of effort, but could be worthwhile doing if you had many years of untracked non-deductible contributions.I don't know with certainty, but it is possible there was some non-deductible contributions made, as my wife has been contributing to IRAs for many many years.
I wouldn't even know where to start looking for any contributions she made prior to us filing together (and I'm sure she doesn't know either).
Overlooking Form 8606 is not uncommon, even amongst accountants I've been told. It happened to us, and we were able to set the record straight.
My wife and I have had has 401K (and more recently, other tax deferred retirement accounts) for many years and have no idea about what monies were contributed to what accounts. I have an email into my accountant and hopefully he (1) knows if we filed any 8606 (which I doubt) or (2) knows by some other means if we contributed non-deductible funds to a traditional IRA. But, that would only go back about 25 years.
Statistics: Posted by josephny — Tue Jul 16, 2024 12:25 pm — Replies 42 — Views 1309