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mxgrr
New Member

I moved my old 401K to a self IRA but had after tax contributions in it. Can I move those out to a regular investment?

What can I do with those (small) after tax contributions? If I add them to the new IRA, can I just track them as after tax?
1 Best answer

Accepted Solutions
KenH1
New Member

I moved my old 401K to a self IRA but had after tax contributions in it. Can I move those out to a regular investment?

No. Once you combine deductible and non-deductible IRA (or 401k) contributions, they are commingled forever.  Or, at least until you distribute the entire account.  If that's not an option, be sure to continually keep track of:

1) Your previous non-deductible contributions, and

2) Your cost basis.  If you never withdraw, your cost basis is the same as #1.  As you withdraw pieces of the commingled IRA, a pro-rated amount is not taxed and the cost basis is adjusted down.  TurboTax handles this pretty easily.

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1 Reply
KenH1
New Member

I moved my old 401K to a self IRA but had after tax contributions in it. Can I move those out to a regular investment?

No. Once you combine deductible and non-deductible IRA (or 401k) contributions, they are commingled forever.  Or, at least until you distribute the entire account.  If that's not an option, be sure to continually keep track of:

1) Your previous non-deductible contributions, and

2) Your cost basis.  If you never withdraw, your cost basis is the same as #1.  As you withdraw pieces of the commingled IRA, a pro-rated amount is not taxed and the cost basis is adjusted down.  TurboTax handles this pretty easily.

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