The IRS considers you to own 1 TIRA, regardless of how many accounts you have, so drawing funds from 2 separate IRAs in Steps 1 & 2 isn't necessary. It's fine if that's how you want to skin the cat.1, Convert $9,000 from my trad-IRA One to my Roth IRA in January through the Fidelity website. No tax withheld.
2, Mail Fidelity my Roth IRA Conversion form that takes $1,000 from my pre tax IRA Two and withhold $900 for federal tax and $100 for state tax in November to avoid underpayment tax penalties.
3, Deposit $1,000 to my Roth IRA from my Fidelity taxable brokerage account by using a Fidelity deposit slip form with a "Roth conversion" box checked in December.
Is my step 3 correct because you use "60 day rollover"?
In effect, $10k is leaving your TIRA, with $9k converted directly. The other $1k that's withdrawn is 100% withheld for Fed/state taxes, leaving a $1k shortfall that you "top off' with a $1k check from a taxable account, resulting in a $10k Roth conversion.
Just code the Fidelity deposit form for the $1k check as "Roth conversion" instead of "60-day rollover" to ensure that your Form 5498 gets filled out properly.. If you check "60-day rollover," Fidelity will put $1k into F5498 Box 2 "Rollover contributions", when you want the full $10k Roth conversion shown in Box 3 "Roth IRA conversion amount."
It's confusing, because you are doing a transaction that is both a 60-day rollover and a conversion, but the Roth conversion is what needs to be recorded on the F5498.
Statistics: Posted by Navillus1968 — Mon Oct 13, 2025 7:11 pm — Replies 23 — Views 4541