IRA Consolidation for Backdoor Roth Contributions Help

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AlottaJuicy
Posts: 12
Joined: Fri Mar 08, 2024 12:05 pm

IRA Consolidation for Backdoor Roth Contributions Help

Post by AlottaJuicy »

Im relatively new to this forum and am looking for help in simplifying my IRAs to simplify backdoor IRA contributions and eliminate ProRata taxation consequences.

Is it necessary to convert an untouched existing Rollover IRA. It contains a Primecap fund that is presently closed to new investors and not sure it can transfer in kind. It has performed pretty well during downturns.

Any issues with rolling the basis portion of TIRAs into an existing Roth IRA that has a balance (some from backdoor Roth contributions)

Thanks

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Last edited by AlottaJuicy on Tue Apr 02, 2024 10:06 am, edited 1 time in total.
toddthebod
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Joined: Wed May 18, 2022 12:42 pm

Re: IRA Consolidation for Backdoor Roth Contributions Help

Post by toddthebod »

AlottaJuicy wrote: Tue Apr 02, 2024 8:48 am is it necessary to convert an untouched existing Rollover IRA. It contains a Primecap fund that is presently closed to new investors and not sure it can transfer in kind. It has performed pretty well during downturns.
Convert is the wrong word. But yes, it is necessary to move those assets into your 401(k). You'll have to ask Vanguard if you can rollover in-kind. You certainly could not across institutions or with a regular (i.e., not solo 401(k)) workplace plan.
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retiredjg
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Re: IRA Consolidation for Backdoor Roth Contributions Help

Post by retiredjg »

AlottaJuicy wrote: Tue Apr 02, 2024 8:48 am Im relatively new to this forum and am looking for help in simplifying my IRAs to avoid future backdoor IRA contributions.
This statement does not make sense. The way to avoid future backdoor IRA contributions is to just not make them. Are you asking about avoiding pro-rating with IRAs if you use the backdoor method?

is it necessary to convert an untouched existing Rollover IRA. It contains a Primecap fund that is presently closed to new investors and not sure it can transfer in kind. It has performed pretty well during downturns.
I'm not sure you mean "convert". That means to move the money from tIRA to Roth IRA. Are you trying to rollover your tIRA into a work plan? If yes, you would have to sell the Primecap. I do not believe it is possible to do a rollover "in kind" into a 40k.

Any issues with rolling the basis portion of TIRAs into an existing Roth IRA that has a balance (some from backdoor Roth contributions)
Basis in tIRA means that you have made non-deductible contributions in the past. Have you done that?

The chart talks about rolling tIRAs into a Solo 401k. You must have self employment income to open a Solo 401k. Do you have that?

Maybe you should tell us what you have and what you want to do.
Topic Author
AlottaJuicy
Posts: 12
Joined: Fri Mar 08, 2024 12:05 pm

Re: IRA Consolidation for Backdoor Roth Contributions Help

Post by AlottaJuicy »

Thanks for your input!

I corrected my first sentence in the original post, what I meant to say was:

Im relatively new to this forum and am looking for help in simplifying my IRAs to simplify backdoor IRA contributions and eliminate ProRata consequences. ...Again I am new to this forum and learning some correct terminology. My apologies.

I own a side business LLC with some income streams and already have a Fidelity Solo 401k albeit with minimal contributions. My intention is to roll the tIRAs and the existing Vanguard Rollover IRA into it.

The tIRAs are 20-30 years old and have been inactive for contributions for at least 20 years. I am trying to derive basis since I have discarded old tax records. I have contacted the custodians to send me details on very old transactions\contribution amounts. I plan on matching the contributions to the deductibility MAGI limits for each year and my income record from SSA.gov to determine when my income started exceeding deductibility limits.

Thanks Again!
toddthebod
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Re: IRA Consolidation for Backdoor Roth Contributions Help

Post by toddthebod »

AlottaJuicy wrote: Tue Apr 02, 2024 10:23 am Thanks for your input!

I corrected my first sentence in the original post, what I meant to say was:

Im relatively new to this forum and am looking for help in simplifying my IRAs to simplify backdoor IRA contributions and eliminate ProRata consequences. ...Again I am new to this forum and learning some correct terminology. My apologies.

I own a side business LLC with some income streams and already have a Fidelity Solo 401k albeit with minimal contributions. My intention is to roll the tIRAs and the existing Vanguard Rollover IRA into it.

The tIRAs are 20-30 years old and have been inactive for contributions for at least 20 years. I am trying to derive basis since I have discarded old tax records. I have contacted the custodians to send me details on very old transactions\contribution amounts. I plan on matching the contributions to the deductibility MAGI limits for each year and my income record from SSA.gov to determine when my income started exceeding deductibility limits.

Thanks Again!
Why do you think you have basis in your old traditional IRAs? It was not very common for people to make non-deductible contributions back then.
Last edited by toddthebod on Tue Apr 02, 2024 12:23 pm, edited 1 time in total.
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retiredjg
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Re: IRA Consolidation for Backdoor Roth Contributions Help

Post by retiredjg »

AlottaJuicy wrote: Tue Apr 02, 2024 10:23 am ...Again I am new to this forum and learning some correct terminology. My apologies.
Apologies not needed. Just bear with us...sometimes it takes some questions to know what a poster is actually asking. :happy

The tIRAs are 20-30 years old and have been inactive for contributions for at least 20 years. I am trying to derive basis since I have discarded old tax records. I have contacted the custodians to send me details on very old transactions\contribution amounts. I plan on matching the contributions to the deductibility MAGI limits for each year and my income record from SSA.gov to determine when my income started exceeding deductibility limits.
Sounds like a very big job. Good luck with it.
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Re: IRA Consolidation for Backdoor Roth Contributions Help

Post by placeholder »

The custodians can't help with basis as that is between you and the irs as to what was deducted or not when placed in the traditional ira.
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