Reverse Rollover from IRA to 401K and Back Door Roth

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
Post Reply
Topic Author
ada88
Posts: 1
Joined: Fri Feb 14, 2020 4:58 pm

Reverse Rollover from IRA to 401K and Back Door Roth

Post by ada88 » Fri Feb 14, 2020 5:20 pm

First time post - so thank you all in advance. Need some help and guidance.
Last year (2019) I had 3 accounts 1) 401k plan from my employer, 2) a Roth IRA (with post tax contributions and earnings over several years) and 3) A traditional IRA with post* (yes this is correct, not pretax) tax contributions and earnings over several years. To take advantage of backdoor Roth which i could not do without the risk of proration on account of my traditional IRA, i performed 2 transactions;
A) reverse rolled over my entire traditional IRA to my qualified employer sponsored 401K plan
B) rolled over after tax contributions (not earnings) from my 401K in to my Roth IRA
All of which are managed by Fidelity. I completed all of the above by middle of Dec 2019 so certainly before the end of calendar year
I was told by Fidelity that both of the above will not be taxable events -since i am first reverse rolling in to a 401K and then rolling from 401K to a roth IRA. I hope they gave me good advice but if somebody confirms that will be great (because my tax consultants could not).

Now that i have zeroed out my traditional IRA, i would like to contribute 6K (for 2019) post tax to my traditional IRA and move it to my Roth IRA account within 24-48 hrs to take advantage of the back door roth. My questions are;
1/ Am i still allowed to avail to back door roth for 2019 in spite of all the other transactions made
2/ Will the IRS consider my total rollovers for 2019 and consider taxing my 6K as prorated, or is it only the final amount at the end of calendar year that is considered for proration (which in my case is zero).
Can anybody provide some advice - bottom line i want to make sure this is all legal, and if allowed want to not lose the opportunity.

Post Reply