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I have been doing both backdoor Roth IRA conversion and also the mega backdoor Roth IRA conversion.

There's some ambiguity about whether congress is going to disallow these.

Every paycheck I contribute after-tax money to my 401k, which then has automatic Roth in-plan conversion. But I need to manually invoke the rollover to the Roth IRA. There are no fees charged for this.

However I have usually done this once a year. Now I am thinking I might do it every paycheck.

Is there a downside to performing too many rollover?

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  • If your 401(k) has automatic Roth conversion, then rolling over from Roth 401(k) to Roth IRA isn't particularly urgent unless you want to make withdrawals. I personally would say once a year is plenty. The exception would be if your 401(k) only offers funds with high expenses, but given that it allows the mega backdoor Roth this seems unlikely.
    – Craig W
    Mar 19, 2022 at 17:40
  • Do they charge a fee to do this? Mar 19, 2022 at 23:16

1 Answer 1

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There's some ambiguity about whether congress is going to disallow these.

Unlikely. It was part of the BBB Act, but that is dead.

Is there a downside to performing too many rollover?

No. As long as it is a direct rollover there's no problem.

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  • Even if it's not a direct transfer, rollovers from 401k to IRA and conversions are not subject to the one-rollover-per-year limit.
    – user102008
    Mar 20, 2022 at 16:00

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