I am (have) completed a backdoor Roth for the first time this year and have some questions about what I should do next.
My wife and I figured there was a very good chance we would not be eligible for our typical Roth IRA contributions based on our AGI this year.
We opened tIRA with 7,000 each at Vanguard early in January 2024 in a money market holding fund. We then realized we needed to deal with her rollover (pre-tax) IRA with Vanguard to avoid pro-rata tax issues. Thankfully we were able to roll this IRA into her workplace 401k. While we waited to figure out/make sure we could do that, the money sat in tIRA fund as described above.
We then converted the tIRA to Roth in our accounts as Vanguard for the total fund balance (~$7030). My understanding is we will owe taxes on the converted amount >$7000.
Now, on the same day the conversion processed, the additional dividend paid into the tIRA account. So now following the conversion there is ~$20 in the tIRA account, an account I imagine would disappear.
Do I need to be worried?
What the way to clean this up with the least headache and keep things simple from a retirement investment perspective going forward?
Thank you.
My wife and I figured there was a very good chance we would not be eligible for our typical Roth IRA contributions based on our AGI this year.
We opened tIRA with 7,000 each at Vanguard early in January 2024 in a money market holding fund. We then realized we needed to deal with her rollover (pre-tax) IRA with Vanguard to avoid pro-rata tax issues. Thankfully we were able to roll this IRA into her workplace 401k. While we waited to figure out/make sure we could do that, the money sat in tIRA fund as described above.
We then converted the tIRA to Roth in our accounts as Vanguard for the total fund balance (~$7030). My understanding is we will owe taxes on the converted amount >$7000.
Now, on the same day the conversion processed, the additional dividend paid into the tIRA account. So now following the conversion there is ~$20 in the tIRA account, an account I imagine would disappear.
Do I need to be worried?
What the way to clean this up with the least headache and keep things simple from a retirement investment perspective going forward?
Thank you.
Statistics: Posted by NeurNto — Wed Feb 21, 2024 8:24 pm — Replies 1 — Views 147