topic 401k rollover with Roth in Retirement tax questions

401k rollover with Roth

kman9 — Fri, 22 Oct 2021 20:40:51 GMT

I changed jobs this year and my 401k through previous employer has a pretax and a Roth portion.
I already have a traditional Roth account and have contributed the maximum this year.

If I rollover the 401k Roth portion to a traditional Roth do I have to pay taxes?

Re: 401k rollover with Roth

macuser_22 — Fri, 22 Oct 2021 21:26:45 GMT

@kman9 wrote:

I changed jobs this year and my 401k through previous employer has a pretax and a Roth portion.
I already have a traditional Roth account and have contributed the maximum this year.

If I rollover the 401k Roth portion to a traditional Roth do I have to pay taxes?

No. There is no tax on a rollover.

Re: 401k rollover with Roth

Opus 17 — Sat, 23 Oct 2021 16:58:30 GMT

@macuser_22 wrote:

@kman9 wrote:

I changed jobs this year and my 401k through previous employer has a pretax and a Roth portion.
I already have a traditional Roth account and have contributed the maximum this year.

If I rollover the 401k Roth portion to a traditional Roth do I have to pay taxes?

No. There is no tax on a rollover.

HOWEVER,

There is a 60 day time limit, and if you do an indirect rollover, where you get a check and deposit it into the new account, your prior 401(k) might be required to withhold part of it for taxes. If that happens and you don't find money from some place else to make it up, you could owe tax on the partial withdrawal. You want to do a direct rollover, where the funds are transferred directly from the 401(k) trustee to the IRA trustee and you never handle the money in between.

A direct rollover does not count as a contribution, so you aren't limited if you already contributed to the IRA, and it does not constitute a withdrawal as long as it is direct rollover and all the money you take out of plan A makes it into plan B within 60 days.