Instructions For Form 8606 - Nondeductible Iras

Roth IRA in the amount of $10,000.

Basis in Roth IRA Conversions — Line 24

You would report total distributions of

IF the most recent year

THEN enter on Form 8606, line

PLUS the sum of the

$40,000 on Form 8606, line 19. You

prior to 2006 in which you 24, this amount...

amounts on the

have no first-time homebuyer expenses

had a distribution* in

following lines...

reported on line 20, so you would also

excess of your basis in

enter $40,000 on line 21. You would

contributions was...

then complete lines 22 through 24 as

instructed. Form 8606, line 25a, shows

2005

The excess, if any, of your 2005

Line 16 of your 2006

an amount of $20,000. You would enter

(your 2005 Form 8606, line

Form 8606, line 24, over line 23**

Form 8606

$5,000 ($20,000 x $10,000/$40,000) on

22, was less than line 19 of

of that Form 8606.

line 25b. You would also enter $5,000

that Form 8606)

on Form 8915, line 23.

2004

The excess, if any, of your 2004

Line 16 of your 2005

Privacy Act and Paperwork

(your 2004 Form 8606, line

Form 8606, line 24, over line 23**

and 2006 Forms 8606

Reduction Act Notice. We ask for the

22, was less than line 19 of

of that Form 8606.

that Form 8606)

information on this form to carry out the

Internal Revenue laws of the United

2003

The excess, if any, of your 2003

Line 16 of your 2004

States. We need this information to

(you had an amount on your Form 8606, line 22, over line 21 of

through 2006 Forms

ensure that you are complying with

2003 Form 8606, line 21)

that Form 8606.

8606

these laws and to allow us to figure and

collect the right amount of tax. You are

2002

The excess, if any, of your 2002

Line 16 of your 2003

(you had an amount on your

Form 8606, line 22, over

through 2006

required to give us this information if

2002 Form 8606, line 21)

line 21 of that Form 8606.

Forms 8606

you made certain contributions or

received certain distributions from

2001

The excess, if any, of your 2001

Line 16 of your 2002

qualified plans, including IRAs, and

(you had an amount on your

Form 8606, line 22, over

through 2006

other tax-favored accounts. Our legal

2001 Form 8606, line 21)

line 21 of that Form 8606.

Forms 8606

right to ask for the information

2000

requested on this form is sections

The excess, if any, of your 2000

Line 16 of your 2001

(you had an amount on your

6001, 6011, 6012(a), and 6109 and

Form 8606, line 25, over

through 2006 Forms

2000 Form 8606,

their regulations. The reason we need

line 19 of that Form 8606.

8606

line 19)

your social security number is to secure

proper identification in order to gain

Line 14c of your 2000

1999

access to the tax information in our files

The excess, if any, of your 1999

Form 8606 and line 16

(you had an amount on your

to properly process the form.

Form 8606, line 25, over

of your 2001 through

1999 Form 8606,

You are not required to provide the

line 19 of that Form 8606.

2006

line 19)

information requested on a form that is

Forms 8606

subject to the Paperwork Reduction Act

Line 14c of your 1999

unless the form displays a valid OMB

1998

The excess, if any, of your 1998

and 2000 Forms 8606

control number. Books or records

(you had an amount on your

Form 8606, line 14c, over

and line 16 of your

1998 Form 8606,

relating to a form or its instructions

line 20 of that Form 8606.

2001 through 2006

line 20)

must be retained as long as their

Forms 8606

contents may become material in the

Line 14c of your 1998,

administration of any Internal Revenue

Did not have such a

1999, and 2000 Forms

law. Generally, tax returns and return

The amount from your 2006 Form

distribution in excess of your

8606 and line 16 of

information are confidential, as required

8606, line 16.

basis in contributions

your 2001 through

by section 6103. However, we may give

2005 Forms 8606

the information to the Department of

Justice for civil and criminal litigation,

*Excluding rollovers, recharacterizations, and contributions that you had returned to you.

and to cities, states, and the District of

**Refigure line 23 without taking into account any amount entered on Form 8606, line 20.

Columbia to carry out their tax laws. We

may also disclose this information to

other countries under a tax treaty, to

contributions, use the chart above to

amount from line 25a on line 25b. If you

federal and state agencies to enforce

federal nontax criminal laws, or to

figure the amount to enter on line 24.

have distributions unrelated to

•

If you did not take such a distribution

Hurricanes Katrina, Rita, and Wilma, as

federal law enforcement and

before 2006, enter on line 24 the total

well as qualified hurricane distributions,

intelligence agencies to combat

of all your conversions to Roth IRAs

you will need to multiply the amount on

terrorism.

(other than amounts recharacterized).

line 25a by a fraction. The numerator of

The average time and expenses

These amounts are shown on line 14c

the fraction is your total qualified

required to complete and file this form

of your 1998, 1999, and 2000 Forms

hurricane distributions and the

will vary depending on individual

8606 and line 16 of your 2001 through

denominator is the amount from Form

circumstances. For the estimated

2006 Forms 8606.

8606, line 21. See the example below.

averages, see the instructions for your

•

Increase or decrease the amount on

Example. You received a

income tax return.

line 24 by any basis transferred or

distribution from your Roth IRA (that

If you have suggestions for making

received incident to divorce. Also attach

you did not roll over) in the amount of

this form simpler, we would be happy to

a statement similar to the one

$30,000 on May 1, 2006, unrelated to

hear from you. See the instructions for

explained in the last bulleted item under

Hurricane Katrina, Rita, or Wilma. On

your income tax return.

Line 7 on page 6.

October 30, 2006, you received a

qualified hurricane distribution (as the

Line 25b

result of Hurricane Wilma) from your

If all your distributions are qualified

hurricane distributions, enter the

-8-

Instructions For Form 8606 - Nondeductible Iras - 2006 Page 8

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