Old 401k Contributions

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Old 401k Contributions

Postby nodenuff2 » Mon Jul 01, 2013 12:09 pm

When my company started our 40ik program in the early years we contributed after tax dollars. this amount and its growth are tracked seperately in the 401k report. My question is can I convert that to a Roth? What about the growth not just the initial investment? Thanks for any help in clearing this up for me.
"Good bless America land that I love..."
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Re: Old 401k Contributions

Postby Default User BR » Mon Jul 01, 2013 1:35 pm

Assuming that these were not Roth contributions, then the answer is "maybe". After-tax contributions are eligible for in-service rollover, but the plan does not have to allow it. If it does, then the distribution of any contributions made after 1986 will along bring a share of taxable earnings (that answers your second question I believe).

So first find out when the contributions were made and whether the plan allows in-service rollover of those contributions.


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Re: Old 401k Contributions

Postby Alan S. » Mon Jul 01, 2013 2:37 pm

Analysis of your options here can be very complex, and if possible it is best to try to speak to a senior staffer. If the plan uses an outside administrator (eg Fidelity, Schwab etc) it may be easier to get your options explained in an understandable manner. It may be best to approch your after tax distribution options for the following separate account values:
1) Pre 1987 after tax contributions - as long as your plan tracks these separately, the amounts can typically be distributed and would NOT include any earnings.
2) Post 1986 after tax contributions - these options are more complex and will usually involve a different sub account than the pre 87 amounts and will also include earnings generated.

Details are outlined by Kaye Thomas of Fairmark in the following link that includes other links to separate sub account implications: http://fairmark.com/retirement/roth-acc ... yer-plans/
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Re: Old 401k Contributions

Postby nodenuff2 » Mon Jul 01, 2013 9:31 pm

Thanks I'll start with the administrator first .
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