[Help with 401k rollover, Roth conversion]

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
Post Reply
jwc1754
Posts: 2
Joined: Sun Aug 19, 2018 8:05 am

[Help with 401k rollover, Roth conversion]

Post by jwc1754 » Wed Oct 17, 2018 1:41 pm

[Moved into a stand-alone thread from: Roth conversion - getting conflicting info about taxes --admin LadyGeek]

I am planning to rollover pre-tax 401k to Vanguard TIRA account this year. And planning to do ROTH conversion next year by myself. What tool should i use for ROTH conversion? And what tax forms do i need to fill or expect to receive from Vanguard? This will be my first time to do ROTH conversion myself. Should i ask Vanguard to do it? Do they charge fee? Any suggestion is greatly appreciated.

User avatar
Duckie
Posts: 6063
Joined: Thu Mar 08, 2007 2:55 pm

Re: [Help with 401k rollover, Roth conversion]

Post by Duckie » Wed Oct 17, 2018 6:17 pm

jwc1754, welcome to the forum.
jwc1754 wrote:I am planning to rollover pre-tax 401k to Vanguard TIRA account this year. And planning to do ROTH conversion next year by myself. What tool should i use for ROTH conversion?
You open a Roth IRA and either online or on the phone transfer the dollar amount you want to convert from the TIRA to the Roth IRA.
And what tax forms do i need to fill or expect to receive from Vanguard?
In early 2019 you will get a 1099-R from your 401k custodian relating to the 2018 rollover. That information goes on your 2018 tax form. (In previous years the rollover amount would have been reported on Form 1040 line 16a with $0 on 16b. I don't know where it'll go now since the forms have changed.) Since you are not converting in 2018, there shouldn't be any taxes due for the rollover.

In May 2019 you will get Form 5498 from Vanguard reporting the rollover. (It will look different.) Save this form.

In 2020 you will get a 1099-R from Vanguard relating to the 2019 conversion. That information first goes on Form 8606 Part II and then on your 2019 tax form. (Previously this would have been reported on Form 1040 line 15b.) The converted amount will be taxable.

In May 2020 you will get Form 5498 from Vanguard reporting the conversion. Save this form.
This will be my first time to do ROTH conversion myself. Should i ask Vanguard to do it?
If you mean call them and have them do the conversion instead of you doing online, you can do it that way.
Do they charge fee?
I don't think so.

Miriam2
Posts: 2345
Joined: Fri Nov 14, 2014 11:51 am

Re: [Help with 401k rollover, Roth conversion]

Post by Miriam2 » Wed Oct 17, 2018 10:19 pm

^^^ Another fabulous Duckie step-by-step :D
Duckie wrote: You open a Roth IRA and either online or on the phone transfer the dollar amount you want to convert from the TIRA to the Roth IRA. . . .

jwc1754
Posts: 2
Joined: Sun Aug 19, 2018 8:05 am

Re: [Help with 401k rollover, Roth conversion]

Post by jwc1754 » Thu Oct 18, 2018 9:11 am

Thanks for all the info!

Post Reply