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Roll Over IRA to 401k?

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  • Roll Over IRA to 401k?

    My wife has an IRA account at TDAM and I have one at Interactive Brokers. The portfolio is all individual stocks or cash and I want to change the portfolio in these accounts. Should I roll over those funds in to our company 401k account (I am the sponsor) which has Vangaurd Admiral funds? Or should I leave them where they are and invest appropriately? I am assuming I should roll them over to make way for backdoor Roth contributions coming up. If it is better to roll them over, should I sell the investments in those accounts and get it to cash or just submit the roll over forms and let them do it? Do they close the account when I roll them over or can it be kept open to use for backdoor Roth conversion? Appreciate your help.

  • #2
    If you're going to do the backdoor Roth strategy then yes, roll to her 401k. Typically, you will have to sell them at TD before rolling them over because 401ks only allow certain funds. One exception would be if there's a self-directed option on the 401k plan. If so, you might be able to rollover the stocks but it all depends on the administrator.


    • #3
      Does your wife also work for you and have a 401k with your plan? She will need to in order to roll over (I realize I'm stating the obvious, but this is for others who may be reading this).

      If the accounts are small (< $10k), you might want to convert them to Roth IRAs. Otherwise, just liquidate and transfer. Choose the company with the lowest transaction fees for liquidation.

      You can request that TDA and IAB keep your accounts open if you want to continue with those brokerages.

      This post I wrote earlier in the year may be helpful:

      Explaining Backdoor Roth IRAs
      My passion is protecting clients and others from predatory and ignorant advisors 270-247-6087 for CPA clients (we are Flat Fee for both CPA & Fee-Only Financial Planning)
      Johanna Fox, CPA, CFP is affiliated with Wrenne Financial for financial planning clients