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New Member
posted Apr 10, 2025 2:59:42 PM

Can I roll over everything in my IRA except the basis amount incurred from a Roth Conversion, and then convert that basis amount tax free in 2025?

If I have created an IRA basis of 4000 from converting post tax (nondeductible) contributions from an IRA which had pretax funds in it (was rolled over from an old 401K) to a Roth IRA. Can I rollover my entire IRA to a 401K except that basis amount, and convert that basis to the Roth IRA in 2025 tax free as long as I file Form 8606 listing that basis amount and no other IRA Funds?

0 4 875
4 Replies
Level 15
Apr 10, 2025 4:46:32 PM

Yes.  Make sure that you only roll the pre-tax money over to the 401(k).  Rolling over to the 401(k) any basis in nondeductible traditional IRA contributions is not permitted (which is why this method can be used to isolate basis from the pre-tax funds.

New Member
Apr 10, 2025 4:52:39 PM

Will my custodian know what portion of the IRA is basis? Or do I tell them to leave the basis amount in the IRA?

The reason I ask is prior to this scenario, the entire IRA was a pre-tax rollover, I made a single post tax contribution, which I immediately rolled over to Roth IRA (next day) and didn't realize the pro rata rule. So technically, there is no more post tax money (basis) in the IRA (unless you're referring simply to an amount and not a tranche as being "basis".

So Now I'm trying to make the best of it for next year...

Level 15
Apr 10, 2025 5:04:00 PM

An IRA custodian has no way to know your basis.  It's your responsibility to track that and make sure that on the date of the distribution being rolled over from the traditional IRA to the 401(k) that the amount being rolled is less than or equal to the value of your traditional IRAs minus your basis in nondeductible traditional IRA contributions.  (Given recent market volatility, you might want to consider rolling over a bit less than your pre-tax amount and accept a bit of your Roth conversion being taxable when you convert all remaining traditional IRA funds to Roth.)

New Member
Apr 10, 2025 5:19:08 PM

Understood, thank you!