After-tax rollover to Roth IRA

Forum|Forum|1 year ago
March 17, 2025
1 reply
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I withdrew some after-tax dollars (not Roth 401k) from my 401(k). The amount that considered growth (not my contributions) is taxable. When answering the question in Turbo Tax: "Is this 1099-R reporting a rollover of funds from a 401k to a designated Roth 401k?", I answered NO because it was rolled into a Roth IRA (not a Roth 401k). This increased my tax due by $2,300. If I answered the same question, YES, as to whether the rollover went to a designated Roth 401k, the taxes due are less.

Is this correct? Why?

Thank you.

Randy

TurboTax Deluxe Online

DaveF1006

If you transfer a 401K to a Roth IRA, the whole amount is taxed because the 401K was funded with pre-tax dollars and you are transferring this into an account that is funded with after-tax dollars.

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