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Did Backdoor Roth, but there's 35 cents left in TIRA

Posted: Thu Oct 05, 2017 9:29 pm
by simplify
I just did my first Backdoor Roth two days ago. Setup new TIRA with Vanguard, contributed $6500 (I'm now 50), and next day after it settled I converted it online using "Convert to Roth IRA" per instructions from calling Vanguard. All went well, now two days later there is a $0.35 balance in TIRA.

I've read through several postings here with a similar question. I definitely chose the "Convert 100%" button, and thought the leftover cents thing wouldn't happen.

Seems like some folks have contacted Vanguard who swept the cents over to the Roth. Should I call Vanguard directly? Can this also be done by repeating the "Convert to Roth IRA" steps again just for the 35 cents?

Also, is there any weirdness with this 35 cents regarding converting? I know I can only contribute $6500, but there's no limit on converting, right? And do the leftover cents make the Form 8606 more complicated?

Re: Did Backdoor Roth, but there's 35 cents left in TIRA

Posted: Thu Oct 05, 2017 9:32 pm
by livesoft
simplify wrote:
Thu Oct 05, 2017 9:29 pm

Seems like some folks have contacted Vanguard who swept the cents over to the Roth. Should I call Vanguard directly? Can this also be done by repeating the "Convert to Roth IRA" steps again just for the 35 cents?

Also, is there any weirdness with this 35 cents regarding converting? I know I can only contribute $6500, but there's no limit on converting, right? And do the leftover cents make the Form 8606 more complicated?
I don't see why you don't try converting the 35 cents right now. What have you got to lose just by trying it? I await your response in the next minute or so after you have tried. Thanks!

Re: Did Backdoor Roth, but there's 35 cents left in TIRA

Posted: Thu Oct 05, 2017 9:45 pm
by simplify
Thanks livesoft. I just tried it on the Vanguard website by repeating the "Convert to Roth IRA" step -- but on the next page it gives a warning:

Holdings alert
You have one or more holdings with either pending activity, zero balance, or open orders on this account.

So I got scared. It also doesn't let me choose the "Convert all of the account" as it did before, and only lets me choose "Convert part of this account in shares".

Re: Did Backdoor Roth, but there's 35 cents left in TIRA

Posted: Thu Oct 05, 2017 9:53 pm
by livesoft
Thanks for the update. I'd say keep trying every day until it works.

Re: Did Backdoor Roth, but there's 35 cents left in TIRA

Posted: Thu Oct 05, 2017 10:11 pm
by Epsilon Delta
I'd say do nothing.

First: I believe that sooner or later Vanguard will move the $0.35 to the Roth no matter what you do. It may take a month or so, they wait long enough to pick up any other stray pennies.
Second: the $0.35 is, at worst, only doing $0.35 of harm. It's not going to disqualify the Roth or cause a large tax bill or anything else you'd actually notice.
Third: Prosac. :twisted:

Re: Did Backdoor Roth, but there's 35 cents left in TIRA

Posted: Thu Oct 05, 2017 10:24 pm
by livesoft
Vanguard won't move it as shown by many other posts.

Re: Did Backdoor Roth, but there's 35 cents left in TIRA

Posted: Fri Oct 06, 2017 3:42 pm
by Sandi_k
If the .35 cents is still "invested", I'd move it to their MM fund and let it sit for a week. Then call and convert it - there should be no fluctuation in price with a MM account.

Re: Did Backdoor Roth, but there's 35 cents left in TIRA

Posted: Fri Oct 06, 2017 4:14 pm
by The529guy
simplify wrote:
Thu Oct 05, 2017 9:29 pm
And do the leftover cents make the Form 8606 more complicated?
It should round down to $0 when filling out Form 8606.

Re: Did Backdoor Roth, but there's 35 cents left in TIRA

Posted: Fri Oct 06, 2017 4:59 pm
by ThrustVectoring
It's 35 cents. Why do you care? Leave it in the money market fund, wait until next year, and instead of opening a new TIRA do a backdoor Roth through contributing to this one.