When to file 8606

I have client who just told me that she contributed to a Roth even though I told her she made too much.  Her financial advisor has pulled the funds out of the Roth and will deposit them to an IRA (which will be non-deductible).  When do I file the 8606?  Do I wait until next year as I’ll likely get at 1099R for the withdraw?



The Roth contribution could have been recharacterized as a TIRA contribution instead of being withdrawn. Since it was withdrawn, any gains that came out with it will be taxable in the year in which the Roth contribution was made. You did not indicate which year the replaced TIRA contribution was for – if for 2023, a 2023 Form 8606 must be filed to report the non deductible contribution. Therefore, if there were gains on the returned contribution made in 2023, a 1040X for 2023 to report the gain income could include the 2023 8606. If 2023 is on extension the return could include both the gain and the 8606. If the replaced contribution is for 2024, the 8606 for 2024 can be filed with the 2024 return.



Add new comment

Log in or register to post comments