FreeTaxUSA Form 8606 Line 1 Empty - Where to Enter 2024 Non-Deductible IRA Contributions?
I contributed $7000 as a non-deductible contribution to my traditional IRA for 2024 and $6500 for 2023. I originally made the 2023 contribution to a Roth IRA but recharacterized it in 2024 (and completed Form 8606 on my 2023 return to track the basis). Right after that, I converted everything (both the 2024 contribution and the recharacterized 2023 contribution) to a Roth IRA during 2024. Since these conversions happened in 2024, my bank sent me a 1099-R showing gross income of $14900 ($1400 being the gains on my contributions). I'm using FreeTaxUSA and here are the questions and my answers on the retirement information screen: Prior Year IRA Contributions: Have you ever had a nondeductible traditional IRA contribution on any prior year tax return? **Yes** Traditional IRA / SEP / SIMPLE Basis and Value: Based on the Form 8606 that you filed in 2023, your total basis for 2023 and earlier years is $6,500. Enter your total basis, if any, in traditional IRAs (including SEP and SIMPLE) for 2023 and earlier years: **$6500** Enter the value of all your traditional, traditional SEP, and traditional SIMPLE IRAs as of December 31, 2024. Don't include any amount rolled over or converted to a Roth IRA. Subtract any disaster distribution repayments and any treated as rollovers that you made in 2024: **$0** Enter the amount, if any, of your contributions to a traditional IRA for 2024 that were actually made from January 1, 2025 through April 15, 2025: **$0** The problem is I don't see anywhere to enter the $7000 non-deductible contribution I made for 2024. As a result, Form 8606 Line 1 is coming out empty, while Line 2 shows $6500 and Line 3 also shows $6500. Where am I supposed to enter my 2024 contribution of $7000?
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Isabella Brown
This is actually a common issue with tax software. FreeTaxUSA should have a separate input for your 2024 non-deductible contributions, but it might be buried in a different section. In Form 8606, Line 1 is specifically for reporting non-deductible contributions made for the current tax year (2024). Line 2 correctly shows your prior year basis ($6500), but Line 1 needs to show your $7000 contribution for 2024. Try looking for a section specifically about "IRA Contributions" or "Retirement Contributions" rather than the basis/value section. There should be a question specifically asking if you made traditional IRA contributions in 2024 that were non-deductible. Sometimes the software doesn't make this intuitive and separates current year contributions from the basis questions. If you can't find it, try going back to the main retirement/IRA menu in FreeTaxUSA and look for an option about "Contributions to Traditional IRAs" for the current year. The software needs this information to properly calculate your basis and taxable portion of your conversion.
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Maya Patel
•I had a similar issue and was pulling my hair out! I think FreeTaxUSA has this under "Deductions" section, not the IRA section where you'd logically expect it. First enter your contribution there, then it'll ask if it's deductible or not. If you mark it as non-deductible, it should populate Form 8606 Line 1. At least that's how it worked for me last year.
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Isabella Brown
•You're absolutely right - FreeTaxUSA sometimes puts the current year contributions under the Deductions menu first, then asks if they're deductible. Once marked as non-deductible, it should flow to Form 8606. The other option is to check if there's an "IRA Contributions" section under the Income menu. Sometimes the software expects you to enter the contribution first before addressing whether it's deductible, especially when you're also reporting a conversion.
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Aiden Rodríguez
I was in this exact situation last year and discovered that FreeTaxUSA has a weird workflow for handling this! Go to the Deductions menu and look for "IRA Contributions" or similar wording. Enter your $7000 contribution there first. It will then ask if this contribution is deductible. When you select "No" or "Non-deductible," it should populate Form 8606 Line 1. The software requires you to enter the contribution as a potential deduction first before it knows to put it on Form 8606. I've been using FreeTaxUSA for years and love it, but the IRA contribution workflow isn't intuitive. Once you find this section, you should see Line 1 populated with your $7000. The form should ultimately show: - Line 1: $7000 (2024 non-deductible contribution) - Line 2: $6500 (prior year basis) - Line 3: $13500 (total basis) Check out https://taxr.ai if you're still stuck - they helped me navigate a similar issue with properly reporting my backdoor Roth conversion.
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Emma Garcia
•How does taxr.ai work exactly? I'm also doing backdoor Roth this year and my tax forms are a mess. Does it actually look at your tax forms or just provide general advice?
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Ava Kim
•I'm confused about why the total on the 1099-R ($14900) is different from what would be the total contributions ($13500). Is that the $1400 in gains? Does FreeTaxUSA handle that difference automatically?
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Aiden Rodríguez
•Taxr.ai works by analyzing your actual tax forms and documents. You upload your forms (like your 1099-R, last year's return, etc.), and their AI reviews everything to identify issues and provide specific guidance for your situation. It's much more personalized than general advice you'd get online. Yes, that $1400 difference is the gain on your contributions before conversion. FreeTaxUSA will handle this automatically once you properly enter your basis. The $13500 is your non-taxable basis (the contributions), and the $1400 gain will be taxable. Once you get Line 1 correctly showing $7000, the software should calculate this properly and show the right taxable amount on your return.
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Emma Garcia
Just wanted to follow up about taxr.ai that was mentioned above. I decided to give it a try with my backdoor Roth paperwork and I'm really glad I did! I uploaded my 1099-R and previous tax return, and it immediately identified that I had incorrectly reported my non-deductible IRA contributions. The tool walked me through exactly where in FreeTaxUSA to enter my contributions (under the Deductions menu, not where I was looking). It even created a custom checklist for my situation to make sure Form 8606 would be filled out correctly. My form now shows the correct amounts on all lines, and I can see that only my earnings will be taxed, not my contributions. Definitely worth it for anyone dealing with IRA conversions or backdoor Roth transactions.
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Ethan Anderson
If you've been struggling to reach the IRS for help with this Form 8606 issue, I highly recommend Claimyr (https://claimyr.com). I spent days trying to get through to an IRS agent for clarification on my backdoor Roth reporting and kept hitting dead ends. Claimyr got me connected to an actual IRS representative in about 15 minutes when I had previously waited for hours without success. The agent walked me through exactly how to report non-deductible contributions and conversions properly on Form 8606, including where these entries should show up in FreeTaxUSA. You can see how it works here: https://youtu.be/_kiP6q8DX5c - it's basically a service that navigates the IRS phone tree for you and calls you once they have an agent on the line. Saved me hours of frustration!
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Layla Mendes
•How does this actually work? I'm skeptical that anyone can get through to the IRS faster than just waiting on hold yourself. Sounds too good to be true.
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Lucas Notre-Dame
•Does this service work for state tax questions too? I've got issues with both federal and state forms for my IRA conversions, and my state tax dept is even harder to reach than the IRS.
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Ethan Anderson
•It works by using automated technology to navigate the IRS phone system and wait on hold for you. Rather than you sitting on hold for hours, their system does it and calls you once they have an agent. It's like having someone else wait in line for you. It's specifically designed for the IRS, so it doesn't work for state tax departments currently. However, the IRS agents can sometimes provide general guidance that applies to both federal and state reporting, especially for forms like 8606 which many states reference for their own tax calculations.
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Layla Mendes
I was so skeptical about Claimyr mentioned above, but I was absolutely desperate after spending THREE DAYS trying to get through to the IRS about my Form 8606 issues with FreeTaxUSA. Well, I tried it yesterday and I'm honestly shocked - I got connected to an IRS agent in about 20 minutes! The agent confirmed exactly what others here suggested - in FreeTaxUSA you need to first enter the contribution under the Deductions section, then indicate it's non-deductible. Once I did that, Line 1 on Form 8606 showed my $7000 contribution correctly. The agent also explained that the $1400 difference between my contributions and 1099-R total would be taxable as earnings, which matched what the form calculated after I fixed the entry. Never thought I'd be leaving positive feedback about talking to the IRS, but here we are!
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Aria Park
I'm doing my first backdoor Roth IRA this year and I'm worried about messing up the Form 8606. Does anyone have a step-by-step checklist for entering everything correctly in FreeTaxUSA? I made a $6500 contribution to traditional IRA then converted it to Roth all in 2024.
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Noah Ali
•Here's my checklist for backdoor Roth in FreeTaxUSA: 1. Enter your 1099-R from the conversion under "Income" 2. Go to "Deductions" and find "IRA Contributions" 3. Enter your traditional IRA contribution amount 4. When asked if it's deductible, select "No" 5. Answer questions about recharacterizations if applicable 6. Verify Form 8606 shows your contribution on Line 1 7. Check that Line 3 shows your total basis 8. Confirm only your earnings (not contributions) appear as taxable Make sure you indicate your Dec 31 traditional IRA balance is $0 if you converted everything. This is super important because otherwise the pro-rata rule might apply incorrectly.
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Aria Park
•Thanks for this! I just followed your steps and it worked perfectly. FreeTaxUSA now shows my contribution on Line 1 of Form 8606 and everything flows correctly. I was looking in the wrong place entirely - thought all IRA stuff would be under the retirement sections but the contribution part is actually under deductions. One more question though - next year when I do this again, will I need to report the $6500 basis from this year? Or does the software pull that automatically from last year's return?
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Chloe Boulanger
Does anyone know if HRBlock handles this Form 8606 issue better than FreeTaxUSA? I'm considering switching tax software because I keep having issues with where to enter non-deductible contributions.
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James Martinez
•I've used both. HRBlock is actually worse for Form 8606 in my experience. It's more expensive AND more confusing. TurboTax handles it better than both but costs way more. FreeTaxUSA is still your best bet for cost vs. functionality - you just need to know where to look (under Deductions rather than the IRA section). Once you know that trick, it works perfectly fine. I've done backdoor Roth conversions with FreeTaxUSA for 3 years now.
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Madison Tipne
I ran into this exact same issue last year! The key is that FreeTaxUSA separates current year contributions from the basis tracking questions, which is super confusing. Here's what you need to do: 1. Go to the **Deductions** section (not the retirement/IRA section where you'd expect) 2. Look for "Traditional and Roth IRA Contributions" or similar wording 3. Enter your $7000 contribution for 2024 4. When it asks if the contribution is deductible, select **"No"** or **"Non-deductible"** 5. Complete any follow-up questions about income limits, etc. Once you do this, FreeTaxUSA should automatically populate Form 8606 Line 1 with your $7000. The form should then show: - Line 1: $7000 (2024 non-deductible contribution) - Line 2: $6500 (prior year basis) - Line 3: $13500 (total basis) The software will then correctly calculate that only the $1400 in gains from your 1099-R is taxable, not your $13500 in contributions. This workflow has caught me off guard before because logically you'd think all IRA stuff would be in the retirement section, but FreeTaxUSA requires you to enter contributions as potential deductions first before it knows to treat them as non-deductible basis.
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Zoe Dimitriou
•This is exactly the explanation I needed! I was making the same mistake as the original poster - looking for IRA contributions in the retirement section instead of deductions. It's counterintuitive but makes sense once you understand FreeTaxUSA's workflow. Just to confirm my understanding: after entering the $7000 as a non-deductible contribution in the Deductions section, Form 8606 should automatically calculate the taxable portion of the conversion correctly? So in this case, only the $1400 in gains would be subject to tax, not the full $14900 from the 1099-R? I'm planning to do a backdoor Roth next year and want to make sure I understand the process completely.
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