After Tax 401k and pro rata rules
Do I need to aggregate all 401k plans when figuring out taxable portion of Roth conversion?
For example
Client has 2 seperate 401k plans. One contains both after tax and pre tax monies and the other just pre tax money.
If I convert only the one with both pre and post tax money do I need to consider the other one as well in calculating tax?
I understand that if I am converting an IRA I need to use pro rata rule using all IRA accounts.
Is same true for 401 k plans or does each plan stand alone?
Thanks as always
Howard
Permalink Submitted by Alan Spross on Tue, 2009-11-03 23:00
Howard,
In this respect, each 401k plan stands alone. Only the IRAs are aggregated together with other TIRA, SEP IRA and SIMPLE IRA accounts.
Permalink Submitted by Howard Hook on Wed, 2009-11-04 00:15
Alan
Thanks
Howard