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Use Form 8606 to report:

 

Nondeductible contributions you made to traditional IRAs,

Distributions from traditional, SEP, or SIMPLE IRAs, if you have ever made nondeductible contributions to traditional IRAs,

Distributions from Roth IRAs, and

Conversions from traditional, SEP, or SIMPLE IRAs to Roth IRAs.

Part I: Nondeductible Contributions to Traditional IRAs and Distributions from Traditional, SEP, and SIMPLE IRAs

Complete Part I only if one or more of the following apply:

 

Your client made nondeductible contributions to a traditional IRA for 2010.

Your client received distributions from a traditional, SEP, or SIMPLE IRA in 2010 and made nondeductible contributions to a traditional IRA in 2010 or an earlier year. For this purpose, a distribution does not include a rollover, one-time distribution to fund an HSA, conversion, recharacterization, or return of certain contributions.

Your client converted part, but not all, of a traditional, SEP, or SIMPLE IRA to a Roth IRA in 2010 (excluding any portion you recharacterized) and made nondeductible contributions to a traditional IRA in 2010 or an earlier year.

 

Fill in the IRA Worksheet and Forms 1099-R first. Then complete this form. Many entries will be calculated for you. Sure-Fire includes two Forms 8606: one for the taxpayer and one for the spouse. Be sure you select the correct form. Select the check box at the top of the form if you are filing this form by itself and not with your tax return.

Part II: 2010 Conversions From Traditional, SEP, or SIMPLE IRAs to Roth IRAs

Complete this part if the taxpayer converted part or all of their traditional, SEP, and SIMPLE IRAs to a Roth IRA in 2010 (excluding any portion the taxpayer recharacterized).

Part III: Rollovers from Qualified Retirement Plans to Roth IRAs

Complete this part if the taxpayer has rolled over part or all of their qualified retirement plan to a Roth IRA in 2010 (excluding recharacterizations).

Part IV: Distribution from Roth IRAs

Complete this part only if the taxpayer took a distribution from a Roth IRA in 2010. For this purpose, a distribution does not include a rollover, a one-time distribution to fund an HSA, recharacterization, or return of certain contributions. See the IRS form instructions for more information.