Hello,
My company has terminated the 401K benefit and I have to move the money into another account. I am trying to decide between traditional IRA and Roth IRA. My husband and I make too much money to directly contribute to Roth IRA and I know that if open a traditional IRA that I will not be eligible to make backdoor contributions. However, my husband does have a Roth IRA already so we can make backdoor contributions to his.
The 401K has about $24,000 in it and if I roll it over to Roth IRA I will have to pay taxes on it. If my company plans to reinstate the 401K in the future, can I just roll it over into Traditional IRA for the time being (not have to pay taxes on it) and then roll it back over in 401K when I am able to? At that point, I will be eligible to make a backdoor Roth contribution.
Thanks!
My company has terminated the 401K benefit and I have to move the money into another account. I am trying to decide between traditional IRA and Roth IRA. My husband and I make too much money to directly contribute to Roth IRA and I know that if open a traditional IRA that I will not be eligible to make backdoor contributions. However, my husband does have a Roth IRA already so we can make backdoor contributions to his.
The 401K has about $24,000 in it and if I roll it over to Roth IRA I will have to pay taxes on it. If my company plans to reinstate the 401K in the future, can I just roll it over into Traditional IRA for the time being (not have to pay taxes on it) and then roll it back over in 401K when I am able to? At that point, I will be eligible to make a backdoor Roth contribution.
Thanks!
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