Form 8606: How to Report Nondeductible IRA Contributions

You fill out Form 8606 whenever you make a nondeductible contribution to a traditional IRA, convert traditional IRA money to a Roth IRA, or take a distribution from an IRA that holds after-tax money. The form tracks your "basis," the after-tax dollars in your IRAs, so you are not taxed on them a second time. This guide walks through each part line by line, with two worked backdoor Roth examples for the 2025 tax year (the return most people are filing or extending right now).

When You Must File Form 8606

The IRS asks for Form 8606 in these situations, per its published form instructions:

• You made a nondeductible contribution to a traditional IRA for the year (Part I).
• You converted money from a traditional, SEP, or SIMPLE IRA to a Roth IRA, including a backdoor Roth (Part II).
• You took a distribution from a traditional, SEP, or SIMPLE IRA and you have basis from earlier years (Part I).
• You took a distribution from a Roth IRA that is not a qualified distribution (Part III).

The form is filed with your Form 1040, but it also stands on its own. If you forgot it in a prior year, you can send a late Form 8606 by itself. The IRS lists a $50 penalty for failing to file when required, and a $100 penalty for overstating nondeductible contributions, so it is worth getting right. Check the current figures in the official instructions at irs.gov before you file.

Gather Your Numbers First

Before you open the form, collect five things:

1. Last year's Form 8606, line 14. This is your basis carried forward. It goes on this year's line 2. If you never filed one, your basis is zero for IRS purposes until you fix that.
2. Form 5498 from your IRA custodian. It shows contributions for the year, including those made between January 1 and April 15 of the following year.
3. Form 1099-R for any conversion or distribution during the year.
4. December 31 balances of every traditional, SEP, and SIMPLE IRA you own, across all custodians. Roth IRAs do not count.
5. The total you contributed as nondeductible, which is whatever you did not deduct on your return.

Part I: Nondeductible Contributions and Basis

Part I figures out how much of your IRA is basis and how much of any conversion or distribution is taxable. The key lines:

• Line 1: nondeductible contributions for the year.
• Line 2: total basis from prior years (last year's line 14).
• Line 3: lines 1 and 2 added together.
• Line 4: contributions made January 1 through April 15 of next year that you counted on line 1 (they count toward this year, so they are handled here).
• Line 5: line 3 minus line 4.
• Line 6: December 31 value of all your traditional, SEP, and SIMPLE IRAs.
• Line 7: distributions you took during the year, not counting conversions.
• Line 8: the net amount you converted to a Roth IRA.
• Line 9: lines 6, 7, and 8 added together.
• Line 10: line 5 divided by line 9, shown as a decimal and not more than 1.000. This is your after-tax ratio.
• Line 11: line 8 times line 10, the nontaxable part of the conversion.
• Line 14: your total basis carried forward, which becomes next year's line 2.

Line numbering can shift slightly between tax years, so match against the actual form for your year rather than this list alone.

Part II: Roth Conversions

Part II is short. Line 16 is the amount you converted, line 17 is the basis portion (from line 11 in Part I), and line 18 is the taxable amount, line 16 minus line 17. The line 18 figure goes to Form 1040, line 4b. The gross conversion from your Form 1099-R goes on line 4a.

Worked Example 1: Clean Backdoor Roth

Maria, single, earns too much to contribute to a Roth IRA directly for 2025. She has no other IRAs and no prior basis. In 2025 she contributes $7,000 to a traditional IRA, takes no deduction, and converts the full $7,000 to Roth a few days later. Her December 31 traditional IRA balance is $0.

Result: the conversion is fully nontaxable, and no basis carries forward because it all moved to Roth.

Worked Example 2: The Pro-Rata Surprise

Dan does the same $7,000 contribution and conversion, but he also has $43,000 of pre-tax money in a rollover IRA on December 31. The IRS treats all of his traditional IRAs as one pot, so he cannot convert only the after-tax dollars.

• Line 5: $7,000. Line 6: $43,000. Line 8: $7,000. Line 9: $50,000.
• Line 10: 7,000 divided by 50,000 = 0.140.
• Line 11: $7,000 times 0.140 = $980 nontaxable.
• Line 14: $7,000 minus $980 = $6,020 of basis carried to next year.
• Line 17: $980. Line 18: $6,020 taxable.

Dan owes ordinary income tax on $6,020 this year. The fix, if his employer plan accepts it, is to roll the pre-tax IRA money into a 401(k) before December 31 so that line 6 is zero. Talk to a tax professional before restructuring.

Common Mistakes

• Skipping the form after a backdoor Roth. The custodian does not file it for you.
• Leaving out other IRAs on line 6. SEP and SIMPLE balances count, and so do accounts at other brokerages.
• Using the converted amount in the December 31 balance. Line 6 is what is left after the conversion, not before it.
• Forgetting prior basis. If line 2 is blank, you pay tax twice on money you already taxed.
• Mismatching the 1040. Line 4a gets the gross conversion and line 4b gets the line 18 amount.

Fill It Out in Your Browser

You can use our ready-made Form 8606 template, or browse the full set of IRS tax form templates. Open the template in our PDF form filler, type your entries into the fields, and download the completed PDF. Nothing to install, and files are deleted automatically after processing. If you want to attach a typed signature to your return packet, you can use sign PDF.

PDF Editify is a paid product, so you will need a plan to export. The One Week Plan is $3 one time and expires on its own, with nothing to cancel, which is usually less than a single month of a subscription editor. See all options on the pricing page. For a refresher on the main return this form attaches to, read what an IRS 1040 form is.

Keeping Records Year to Year

Your basis lives on paper, so keep it there. Save a PDF copy of each year's Form 8606, since line 14 feeds the next year's line 2. Keep Forms 5498 and 1099-R, and a note of which contributions you deducted and which you did not. The IRS says to hold these records until all your IRAs are emptied and the last distribution is reported, which can be decades. A dated folder of completed forms is the simplest approach.

This article is general information, not tax advice. Confirm line numbers and limits against the IRS instructions for your tax year.