@DanaB27
If you rollover your wife’s 401k to the traditional IRA then it will take longer to use up the $4,856 basis because of the pro-rata rule.
- So basically she pays the pro-rata rule until the traditional is $0? Essentially this doesn’t make sense to rollover her 401k into her traditional bc it would increase the value tremendously and she would pay a lot of taxes to convert all to Roth?
- If she does decide to rollover her 401k into traditional, how does she get rid of this $4856 basis specifically? Just convert $4856 and pay taxes on it in one shot?
- If she does not do a reverse rollover, what is the best thing to do with her 401k if she stops working and still has a basis in her traditional IRA?
Thank you
