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I actually got my act together and completed my taxes early this year. However, we now have some extra money that I didn't plan to have this quarter. I would like to put this money in a 2001 IRA. I know that this IRA would not be deductible on my taxes. My question is, do I have to submit an amended return if I invested this money in a IRA marked as a 2001 contribution if it won't affect my taxes in anyway?

Thanks,

Homer
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I will defer if one of the experts on the board contradicts me, but my understanding is "no".

Thanks!
Joe
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I actually got my act together and completed my taxes early this year. However, we now have some extra money that I didn't plan to have this quarter. I would like to put this money in a 2001 IRA. I know that this IRA would not be deductible on my taxes. My question is, do I have to submit an amended return if I invested this money in a IRA marked as a 2001 contribution if it won't affect my taxes in anyway?

Maybe. If your AGI allows a Roth IRA contribution for 2001, that's much preferable to a nondeductible traditional IRA contribution. If you do a Roth, no change to your 2001 return will be necessary since Roth IRA contributions aren't reported on your return.

If your AGI is too high for Roth, you can still do the nondeductible traditional contribution. However, this must be reported on Form 8606, Part I. Doing so establishes your basis in the traditional IRA so you don't get taxed again on this money when you withdraw it in retirement. You'll need to amend your return and attach the 8606, even though it doesn't change your tax.

Phil Marti
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If your AGI is too high for Roth, you can still do the nondeductible traditional contribution. However, this must be reported on Form 8606, Part I. Doing so establishes your basis in the traditional IRA so you don't get taxed again on this money when you withdraw it in retirement. You'll need to amend your return and attach the 8606, even though it doesn't change your tax.

I guess I will have to do the amended return. If memory serves, I think TurboTax will walk me through an amended return. It is nice to know the reasoning behind this too thanks for the great response.

- Homer
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