Welcome to the forum.I am rolling over all my pretax tax advantaged 401(k)s to a Roth IRA. I am early in my career and just graduated medicine. I should’ve done this before in residency where my income was well but I will be in a lower tax bracket this year so I figured this is the time. I am doing this mainly because I want to backdoor Roth IRA and I can’t do that when I have pre tax money apparently.
The conversion of your traditional 401k balance to Roth IRA may make sense due to your lower marginal tax rate. However, there is no need to zero out your traditional pretax 401k balance using Roth conversions in order to do a backdoor Roth (IRA) not subject to pro-rated taxes. Pretax $ in a 401k have no impact on a backdoor Roth for an IRA.
This BH wiki page about backdoor Roth (IRA) may be helpful:
https://www.bogleheads.org/wiki/Backdoor_Roth
Statistics: Posted by HomeStretch — Sat Nov 02, 2024 4:01 am — Replies 41 — Views 1828