Tax Explorer
Level 4
07-26-2023
12:37 PM
- Mark as New
- Bookmark
- Subscribe
- Permalink
- Report Inappropriate Content
Hi,
The TurboTx article here says otherwise though. It says that:
"Any money you contribute to a traditional IRA that you do not deduct on your tax return is a “nondeductible contribution.” You still must report these contributions on your return, and you use Form 8606 to do so.
Reporting them saves you money down the road. That’s because no individual’s money is supposed to be subject to federal income tax twice. Form 8606 gets it “on the record” that a portion of the money in your IRA has already been taxed. Later on, when you take distributions, a portion of the money you get back will not be subject to income tax."
