IRA Tax basis
What is the best way to find the tax basis for IRA contributions from the last 36 plus years or ever its inception?
I have been contributing to IRA and I am getting to be 70 years in about 5 years. When I need to withdraw, I need tax basis for the withdrawal
Apart from adding all my contributions (which I can not find), I need some suggestions
Any help will be helpful
Murty
Permalink Submitted by William Tuttle on Sat, 2017-01-07 05:30
All deductible contributions and earnings are subject to ordinary income tax. There is no differentiation between contributions and earnings. Deductible contributions do not establish any basis like in taxable accounts, because they were contributed pre-tax.The only time there is any basis is if you made non-deductible contributions for tax year 1987 and later. If you had any of these you should have filed a Form 8086 for each year showing the increased basis. No deductible contributions, no basis.
Permalink Submitted by MARK CLELAND on Mon, 2017-01-09 18:49
Seems this is a common scenario where the taxpayer is sure he has basis but has lost the 8606’s from earlier tax years to prove it. Does the IRS have the basis in their records and will they provide it to the taxpayer? What advice to the taxpayers? Keep copies of Form 8606’s indefinitely?
Permalink Submitted by Alan - IRA critic on Mon, 2017-01-09 19:16
The 8606 is cumulative with the last one you filed showing your total basis on line 14. Therefore, all you need is the last 8606 you filed. If you do not have your most recent 8606 or any 8606, you would have to order copies of your tax returns for year you think would include your most recent non deductible contributions. And if you did not file 8606 forms, you also might be able to reconstruct your tax history using some combination of the records you do have, your IRA custodian’s records for years you made TIRA contributions, or ordering copies of 5498 contribution forms from the custodian or the IRS. This process can be very time consuming, and is probably not worth the effort unless you have several years that you think you did not file the form. Can the IRS tell your basis if you just call and ask them, my guess is that they cannot, but you might try and see what they say.
Permalink Submitted by Tom Curtis on Mon, 2017-01-09 23:11
Some – though probably not most – IRA custodians track that for you. I did a transfer of IRA assets out of TIAA a couple of years ago and they reported my basis on the 1099-R. It’s worth asking the company that “holds” your IRA and/or your HR people if the IRA is part of an employer plan.
Permalink Submitted by Alan - IRA critic on Tue, 2017-01-10 00:34
No way for TIIA to know your basis (non deductible contributions). What are you looking at on the 1099R? IRA 1099R forms should be showing the entire amount as taxable in Box 2a whether it actually is or not, but taxable amounts are different than basis. Now if this was NOT an IRA, then the plan would know.