Rollover to solo-401k
With an IRA that holds nondeductible and deductible contributions and earnings, I’ve heard it’s possible to roll over the deductible contributions and earnings into a solo-401k plan (assuming the person has self-employment income), thus making a subsequent Roth conversion of the nondeductible contributions much more tax efficient.
If that’s possible, is there a requirement for the rollover to the solo-401k come from a ‘Rollover IRA’ that has only received previous rollovers? or would a ‘participant IRA’ holding contributions from a mix of sources (i.e. rollovers and contributions) be acceptable?
Permalink Submitted by Alan - IRA critic on Wed, 2015-03-11 22:20
There is no requirement for the IRA account to be a rollover IRA unless the solo K provisions include that requirement. Some 401k plans do include that limitation, which is a throwback to the pre 2002 tax rules under which the tax code itself required it.