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Avoiding double taxation of a non-deductible IRA contribution in 2024

DomG

On my 2024 tax return I included an $8K post-tax, non-deductible IRA contribution, listed on Form 8606. That money now sits in a traditional IRA.
When I withdraw, Fidelity will file a Form 1099-R withdrawal with the IRS.

What do I do at that future date to ensure I don't pay tax on that money again?

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Comments

MatthewD

Hi DomG,

As you get distributions and enter the 1099-R in the software, on following pages (in the Retirement Income section) you will be asked if your IRA has a basis. Basis is the after-tax contributions. Answer Yes and enter the total basis from the prior year 8606 and the total value of your IRA. That way it will not be double taxed.