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Questions tagged [roth-conversion]

A Roth conversion refers to taking all or part of the balance of an existing traditional IRA and moving it into a Roth IRA.

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Interest accrued in Traditional IRA during Backdoor Roth Conversion

Similar to another question: Interest accrued before backdoor roth ira conversion, but I want to highlight a specific nuance of my situation. In 2023, I contributed the maximum $6500 to my Traditional ...
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Rollover former employe's 401k after backdoor Roth IRA conversion?

I am no longer at my former employer but I have an existing 401k plan with Vanguard through them. 30% of the contributions were pre-tax. (traditional 401k) 70% of the contributions were post-tax. (...
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Rolling over Traditional 401(k) affected by Pro Rata

I currently have three retirement accounts: Account A: Traditional IRA with Pre-tax money Account B: Traditional IRA with Post-tax money (used for backdoor Roth IRA) Account C: Roth IRA Account D: ...
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How to correct a Roth conversion pro-rata rule mistake on form 8606?

I have an after-tax IRA and pre-tax IRA. In 2022 I converted $30,000 from the pre-tax IRA to a Roth IRA. I wasn't aware of the pro-rata rule. According to pro-rata rule, I was supposed to convert $4,...
sami's user avatar
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Converting some Pre-Tax 401k Contributions to Roth Contributions

Is it possible to convert some Pre-Tax 401k contributions to Roth contributions each year? Since I would have to pay taxes on the amount converted I wouldn't be able to do it all at one time.
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Roth Conversion using up foreign tax credits before and after expatriation

I'd like to sense-check the following scenario, to make sure I don't do something phenomenally stupid and irreversible. I'm hoping that I've correctly understood what I've read on this site & ...
ckp's user avatar
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What tax form is used for Roth conversion within a 401(K)? (Not IRA)

I am not asking about a conversion from 401K to Roth IRA. (That'd be Form 8606 by the way). My employer plan allows both traditional and Roth 401(K). Really. They also allow Roth conversions from ...
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Question about taxes on Roth backdoor IRA

Last year say I made $100,000.00 in income through my job (that is the amount on my w2 in box 1). I have a 401k through my job, so I use Roth backdoor IRA, so last year I moved 6000 into a traditional ...
Ufder's user avatar
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Converted Traditional IRA to Roth IRA (backdoor) with money market funds, is that a mistake?

During last year (2022), I wanted to do a typical backdoor Roth IRA. I made a full $6,000 post-tax contribution to my Traditional IRA, waited for the transfer to settle, and then immediately converted ...
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1 answer
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Does it make sense to get a 529 plan to convert to Roth IRA in the future?

Given the recent changes on rolling over a 529 plan, could one start a 529 plan and then convert it to a Roth 15 years down the line if they don't use it for any schooling? I haven't considered 529 ...
heretoinfinity's user avatar
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Possible to open multiple IRA accounts from the same institution?

Let's say I already have a traditional IRA account with a brokerage, and I've used it for tax deduction last year. Now, I want to use the backdoor Roth conversion method. From what I have ready, I ...
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Roth conversion or AOTC

I'm trying to decide whether to do a Roth conversion or take the American Opportunity Tax Credit (AOTC) for my daughter going to college this year. The Roth conversion would push me over the income ...
tmwn6919's user avatar
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1 answer
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Filing a missing prior year 8606 & Effect on future tax return

I am realizing I messed up a previous backdoor roth - this is what my timeline looks like: On 3/1/2020 Deposit 6k to Traditional IRA For Tax Year 2019 On 3/30/2020 Convert 6k to Roth IRA On 12/31/...
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How can I undo traditional IRA contribution and contribute to Roth IRA instead? [duplicate]

I made a contribution to my traditional IRA account for 2021. Later I learned from my CPA that since we had already reached the deduction limit of 125k for a couple, we won't be getting any tax break ...
haku's user avatar
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1 answer
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Is there a downside to doing multiple Roth IRA conversions?

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 ...
Matthew's user avatar
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How do I determine the cost Basis for IRA funds converted to Roth?

I converted $100,000 from rollover ira to Roth IRA in 2021. What is the basis for this converted amount? I entered zero. I want to make sure I am doing it right.
user65985's user avatar
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Did I lose Backdoor IRA amount by moving into the wrong account?

I live in California. I have 3 accounts - Trading, Traditional IRA and Roth IRA. I moved $6000 (IRA limit) from my Trading account to Traditional IRA, and then I intended to move this amount to Roth ...
Ufder's user avatar
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Can I have more than one IRA if I utilize the backdoor Roth conversion option?

A few years ago I began doing backdoor Roth contributions. Up until that point I had done traditional Roth contributions only. I contacted my IRA account holder Vanguard and asked some questions about ...
Paul's user avatar
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What can be withdrawn from a Roth IRA without penalty before 59 1/2?

I know that contributions (dollar amount equal to what was directly contributed to the Roth IRA) can be withdrawn tax-free and penalty-free at any time, and that earnings on those contributions will ...
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Roth Conversion over ACA Cliff

Since the ACA Cliff is eliminated for 2021 (& 2022), it appears to be a good time to do an extra large Roth Conversion. Assuming the individual is already close to the ACA cliff (and not on ...
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Best Option to Fix Roth IRA Excess Contribution For 2021

I have maxed out my Roth IRA contribution this year (2021) not knowing there was a limit due to my income. To put it simply, I only qualify for $5k and I put in $6K. The IRA has now grown to about $8k ...
Georgy's user avatar
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Backdoor Roth with contributions from previous years?

Say an individual maxed out their IRA contribution for 10 years running, and each year was not able to take a deduction on their IRA contributions because their income was above the limit. Could that ...
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Recharacterized 2 years of Roth IRA Contributions - how much to invest through Backdoor?

I have mistakenly been contributing to a Roth IRA for 2020 and 2021 while my adjusted gross income (AGI) exceeded the 120k limit. Therefore, I called Vanguard to recharacterize my contributions to my ...
Nick's user avatar
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Automated/Least Painful Backdoor Roth IRA + Nuanced Questions

As quick background, I'm an expat that has been living abroad for the past 8+ years, and have been and continue to be ineligible to contribute to an old Roth 401k that I still possess with my previous ...
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Can you fund your Traditional IRA after rolling it over to Roth IRA?

The Traditional IRA has a $6,000 limit per year. If I Step1: Transfer 6k to Traditional IRA Step2: Roll over entire 6k to Roth IRA Can I transfer additional 6k to Traditional IRA because Traditional ...
Hexy's user avatar
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-1 votes
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How much of my 401(k) should I roll over to a Roth IRA to pay the least taxes?

I am 61 yrs old want and I want to start rolling over my 401K to a Roth-IRA account. How can I figure out how much money I should roll over in order to pay the least taxes? Through a google search, I ...
Anthony's user avatar
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2 votes
1 answer
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2020 Backdoor Roth IRA Conversion in 2021 - Concern/Questions

In 2019, I did a backdoor Roth IRA conversion that went off without any problems (put $6000 into traditional IRA, converted to Roth IRA). In 2020, I was looking to do the same, but I hit a snag. I ...
cmk2901's user avatar
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2 answers
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Can IRS construe a Roth conversion to be a wash sale?

Should I do Roth IRA conversions after a market crash? I have too much money in my traditional IRA and not enough money in my Roth IRA. Both accounts use VTSAX. I have no intention of touching it any ...
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Tax on backdoor conversion - 1099R

In 2020, I deposited $7,000 (after-tax) in my Traditional IRA (Vanguard) account and then converted them into Roth IRA. One mistake I made was that for my age, the limit for backdoor conversion was $6,...
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1 answer
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Backdoor Roth vs Mega backdoor Roth contributions

I heard about Backdoor Roth IRA, and Mega backdoor Roth contributions. Are they one and the same? Or are they different? I ask because I know some folks who work for a big tech company in the US that ...
Josh's user avatar
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2 votes
3 answers
319 views

Is a backdoor ROTH IRA contribution still worth it if I have pre-tax IRAs that I can't rollover to a 401k yet?

Starting this year, I can no longer contribute to my ROTH IRA. I have three other IRAs: A rollover IRA (pre-tax), opened in 2020 when I rolled over an old 401k. A SIMPLE IRA (pre-tax), opened in 2020 ...
David Gay's user avatar
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1 answer
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Is "Conversion" a technical term in a Backdoor ROTH Conversion?

I'm doing a backdoor ROTH for the first time with Fidelity. My understanding is the process is simple: Create or have a Traditional IRA Create or have a ROTH IRA Put post-tax money into Traditional ...
WannabeCoder's user avatar
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2 votes
1 answer
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Can I legally play this shell-game with the IRS by using “Recharacterization” or “Conversion”, depending on markets?

Let's assume you contribute a certain deductible amount to your IRA on Jan/2, and invest it there. You really want the money in your IRA Roth at the end of the year, but you try to pick the best ...
Aganju's user avatar
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IRA to IRA Roth "Recharacterization" vs "Conversion", is there a difference in result?

Let's assume this simplified case: At the beginning of 2020, there is no money in my IRA. I contribute the maximum amount allowed (for me 7k$, because I'm old) from after-tax money, and next day ...
Aganju's user avatar
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Paying taxes on a converted old retirement account to a Roth IRA from a 401K loan from current employer?

I have an old 403B plan, I am 47 years old and would like to convert part of it to a Roth. I would like to convert $100k to the Roth, but will then have to pay taxes on the conversion. Lets just say ...
Kip Fieg's user avatar
1 vote
1 answer
33 views

Converting a contribution to a Roth IRA >60 days after contributing?

I deposited $6k in 2019, and $6k in 2020, but converted $4k to Roth in 2019, and $8k to Roth in 2020. Will this differ any benefit? Will I be taxed differently?
user3358714's user avatar
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1 answer
125 views

Can a Roth 401(k) be transferred somehow to a Roth IRA if younger than 59.5-year-old and not leaving one's job?

I understand that: A Roth 401(k) may be rolled over to a Roth IRA if older than 59.5-year-old or if leaving one's job. It is possible to do in-service distributions from an after-tax 401(k) to a Roth ...
Franck Dernoncourt's user avatar
2 votes
1 answer
172 views

How can I remedy a Roth IRA contribution which isn't allowed?

I have always contributed the max to my Roth IRA on the first opportunity in the new year, as I did on January 2, 2020. I ended up getting a major raise and bonus in mid-2020 that pushed my income way ...
Matthew's user avatar
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0 votes
1 answer
523 views

Backdoor Roth IRA conversion while owning SEP-IRA as well

I have a SEP-IRA from my consulting years, many years ago (I haven't contributed to it in years but it does have a balance). I wanted to setup a backdoor Roth IRA conversion by creating Traditional ...
D Stellar's user avatar
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3 votes
2 answers
101 views

How do I figure Roth IRA withdrawals after converting multiple times?

I am converting assets from a traditional IRA to a Roth IRA over multiple years. I know that I cannot take any withdrawals from the Roth before 5 years from the start of the year when I first ...
J.Merrill's user avatar
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2 votes
2 answers
88 views

Can I open a Traditional IRA if I have a 401(k) and a Roth IRA?

I have a Roth IRA that I made and a 401(k) account through my employer. I realized that I will be above the income limit to contribute to Roth IRA and saw that I could do a backdoor by putting money ...
Raj's user avatar
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1 vote
1 answer
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Roth conversions that include non-deductible IRA contributions

Spouse has a single traditional IRA account into which was made a non-deductible contribution one year (and the appropriate form filed with our taxes). We understand the pro rata rule for partial ...
Not_Einstein's user avatar
2 votes
2 answers
112 views

How to pay tax on IRA to Roth rollover

I recently changed employers, and merged my old retirement account with a Roth account I have with an independent company. A little less than half the contributions were pre-tax, and I understand I ...
Aaron's user avatar
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3 votes
1 answer
139 views

Does 'Taxable Income' from a Roth conversion count as income source for IRA contribution?

Let's assume Jane is retired, and has no income from employment. She still would like to contribute to her IRA [or Roth IRA], but this is not allowed from capital gains or dividend income. Now Jane ...
Aganju's user avatar
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2 votes
2 answers
2k views

FICA on Traditional IRA to Roth Coversion

I am aware of the fact that we have to pay taxes on the amount we convert from Traditional IRA to Roth IRA. However, I would like to find out if we have to pay FICA taxes on the conversion. General ...
elixir's user avatar
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10 votes
2 answers
1k views

Where can I transfer rollover IRA funds to without it becoming income?

I'd like to move untaxed investment money to a new institution. Originally, the money was held in a 401k, then moved to a Rollover IRA. My new bank has both "Traditional IRA" and "Roth IRA" products ...
user48956's user avatar
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5 votes
3 answers
2k views

Taxation of traditional to Roth IRA conversion for non-resident

I left the USA in 2019, am now in India and so am a non-resident for US tax purposes for 2020, and want to convert part of my traditional IRA to Roth IRA. What are the tax implications of this ...
user2371765's user avatar
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1 vote
1 answer
73 views

Income Tax filing of Roth Info

I may have mis added the amount of 401 K I converted to a Roth account on my taxes. Will the IRS catch that? What will be the penalty?
michelle lawrence's user avatar
2 votes
1 answer
123 views

Converted $1 more than the IRS limit when doing backdoor Roth conversion

For doing backdoor Roth conversion I deposited $6000 into my traditional IRA and then converted it a few days later to a Roth IRA account. The money unfortunately earned a little bit of growth when it ...
Mark's user avatar
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1 vote
1 answer
175 views

Roth conversion: why is cost basis the basis of original SEP-IRA investment?

I just converted some money in a SEP-IRA to a Roth IRA. The value of the fund that money was invested in was down about 10% from when I initially invested in the SEP-IRA. Once the transaction was ...
NeutronStar's user avatar
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