TaxSkeptic: If I understand you correctly, you are saying the following transaction steps in the graphic below (you can ignore step 1 401k in both cases) are a "Fatal Error":As long as you take a tIRA distribution with withholding, you are ok. However the fatal error is to tell Fidelity you are doing a Roth Conversion and withholding. In that case, you are toast whether it is Fidelity's Roth or another Custodian's Roth. That would be a direct rollover custodian to custodian. That is a done deal the moment it happens.
Whereas, in this next series of transaction steps, it seems you are saying is fine and the only valid alternative to the above (please correct if I'm mischaracterizing your points).
But these both have the identical balances across all accounts before and after, and result in exactly the same tax obligation. So either one could work. The first one, as I posted earlier in this thread (see blue font from fidelity rep on Reddit), is fine.
What regulation or IRS rule do you believe the first one violates, or otherwise limits you to less than the desired outcome?
Statistics: Posted by Gnomon — Thu Oct 23, 2025 8:59 pm — Replies 32 — Views 1316