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I was considering rolling over my company stock in my 401k partially into a Roth and partially into a taxable brokerage account so I can capitalize on the net unrealized appreciation and pay taxes on the capital gains portion of the earnings. I am currently in the 28% tax bracket and realize that I will have to pay the taxes immediately on the taxable conversion. My 401k plan allowed me to make before and after-tax contributions (not a roth acct) so the stock is split between both types. The current value of the stock is about $118k and the cost basis is about $81k. The 401k representative I spoke with said the split is about $64k before-tax & 54k after-tax The Plan representative also said that to transfer the after-tax contribution portion into a Roth would lower the overall basis on which my tax liability for the before-tax portion would be calculated and which I will immediately owe based on my ordinary tax rate. After the conversation I’m no longer certain that it is beneficial to pay the tax now or roll it over. I do have enough funds to pay the taxes to cover any immediate tax liability. Do I need a tax advisor to get the best possible outcome on this problem?
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