New client ... when reviewing his prior year returns 2010 and 2011 it appears and he agrees that in 2010 he converted his SEP IRA in the amount of 28000 dollars to a Roth IRA. He said he recalls discussing this with his tax preparer at the time. His 2010 return does show 28000 but 0 as taxable. There is no indication in his return or papers that an 8606 was filed with the return indicating that he wanted to report half in 2011 and half in 2012. His 2011 return does not show anything relating to the above. Nothing reported.
My first thought was to work up an 8606 for 2010 (and include with the amended returns) and amend his 2011 and 2012 returns to reflect 14000 taxable each year. However, after thinking about it, I wonder if I should be amending his 2010 return and report the entire distribution of 28000 as taxable in 2010. Based on the fact that no 8606 was filed to make the election to be taxed in the two future years.
Any comments as to what way you would go. Thanks.
It doesn't help that the client could not find or produce the 1099R from 2010. But he is 99% sure that his intention was to convert his SEP to a Roth at the time. He is also sure that his SEP was a traditional pretax. The money in the SEP was from several years ago when he was self employed.
My first thought was to work up an 8606 for 2010 (and include with the amended returns) and amend his 2011 and 2012 returns to reflect 14000 taxable each year. However, after thinking about it, I wonder if I should be amending his 2010 return and report the entire distribution of 28000 as taxable in 2010. Based on the fact that no 8606 was filed to make the election to be taxed in the two future years.
Any comments as to what way you would go. Thanks.
It doesn't help that the client could not find or produce the 1099R from 2010. But he is 99% sure that his intention was to convert his SEP to a Roth at the time. He is also sure that his SEP was a traditional pretax. The money in the SEP was from several years ago when he was self employed.
Comment