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Like many of you, I am currently preparing my taxes for 2023. I have a question about Backdoor IRA and a particular line in my 2022 Tax Return.

Each year, I have contributed to a Traditional IRA and Converted to Roth IRA, here is the exact schedule:

Date Type Amount
12/29/21 Contribution 6000
12/30/21 Conversion -6000
1/10/2023 Contribution 6000
01/11/2023 Conversion -6000.7
03/30/2023 Contribution 6500
04/03/2023 Conversion -6503.4
01/09/2024 Contribution 7000
01/16/2024 Conversion -7007.07

In my 2022 Tax Return, Form 8606 Line 14 "total basis in traditional IRA for 2022 and earlier years" says $6,000. Should it say $0 given I have done only clean Backdoor IRA? Or is there something I don't understand?

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You had contributed $6000 in January 2023 which was counted as attributed to 2022 (you've made another contribution in March, presumably for 2023). That's the $6000 basis. You've converted it into Roth in 2023, so you had $6000 basis for 2022.

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  • So the basis is basically telling the IRS "I know I contributed 12,500 in one year but it's because 6,000 of it (the basis) was for previous tax year (2022)"?
    – thoma
    Feb 1 at 18:08
  • From the IRS perspective you've contributed it in 2022.
    – littleadv
    Feb 1 at 18:31

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