Incorrect Roth Rollover
When my bank ended it’s investment services in 2020, I rolled my traditional IRA into my traditional 401(k). I also rolled my Roth IRA into my Roth 401(k). I had no idea you can’t do that, and I’m not even sure how I managed it at the time, but now, two years later, the IRS has contacted me and I’ve learned of my mistake. I am now being told I have to pay taxes on the entire amount of the rollover plus fees and penalties. Is there any way for me to correct this mistake? And what happens to the funds that are now in my Roth 401(k) that should never have been deposited?
Thanks
Permalink Submitted by Alan - IRA critic on Fri, 2022-07-22 00:10
Permalink Submitted by David Mertz on Fri, 2022-07-22 01:29
Permalink Submitted by Alison Hatch on Wed, 2022-12-14 10:51
Thank you for the tips. I did indeed do a self-certification for a delayed rollover. I did have to contact my employer to request an administratI’ve correction withdrawal from my Roth 401K (NOT another rollover), but I then deposited the funds into a Roth IRA and provided the fininacial institution a self-certification letter. With the help of a tax lawyer (to cross my t’s and dot my i’s), I provided the IRS a copy of all the paperwork and I just received a letter from them stating that I owe no further taxes for 2020. Matter resolved. Thank you again for the help.
Permalink Submitted by Alan - IRA critic on Wed, 2022-12-14 15:50
Thankyou for the update, as this is very useful info. Could you please update this again in late January with respect to whether the employer plan issued a 2022 1099R form or not, and if they did what the codes were on that form?