Ok, thanks for the explanation. When I roll over the $65K pre-tax amount and leave $15K, which I then convert to a Roth, Form 8606 will take care of this — that makes sense. A few other questions ...
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Ok, thanks for the explanation. When I roll over the $65K pre-tax amount and leave $15K, which I then convert to a Roth, Form 8606 will take care of this — that makes sense. A few other questions came across: If I complete this transaction before December 31 and effectively empty my IRA account, do I need to wait until January 2026 to do a backdoor Roth for 2026, or can I do it right after completing this? For a backdoor Roth, how long do I need to keep the money in the traditional IRA before converting it to Roth? On the tax return for 2026, do I just report the traditional IRA contribution? If I do a backdoor Roth, will the tax documents essentially net to zero (e.g., $8,600 after tax contribution and $8,600 conversion resulting in no tax)? Also, I have a SEP IRA. Is it allowed to roll the $65K into the SEP IRA instead of 401k? Is that even possible? And does having a SEP IRA create any issues for doing a backdoor Roth?