After-tax 401(k) rollover to Roth IRA
I have a client who we recently rolled over their 401(k) to a Traditional IRA. Part of that rollover included after-tax contributions. The client was provided a separate check for that amount, around $20k. The original plan was to rollover those after-tax contributions right to their Roth IRA, however the client elected to deposit that after-tax check directly to their savings account to help pay for some home renovations.
The client mentioned that once they know how much of that $20k they’ll need they’ll let me know how much they want to rollover into their Roth IRA. Is the client still able to “rollover” those after-tax contributions to their Roth IRA, if so how long does the client have to place all or a portion of that after-tax rollover amount into their Roth IRA?
Permalink Submitted by David Mertz on Wed, 2023-04-05 20:05
The client has 60 days from the date of receipt of the 401(k) distribution to complete the rollover to a Roth IRA of any amount up to the full amount paid to them on the separate check.