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Backdoor Roth IRA

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  • Backdoor Roth IRA

    So I am doing my first Backdoor Roth IRA conversion this year.  I opened a traditional IRA for my wife and I and made a $5500 contribution for both of us. I was going to rollover into a Roth IRA however based on the timing of my contribution the Vanguard Prime Money market gave each of us a distribution of $0.24.  Now the accounts are each slightly more than $5500.  Does anyone have any guidance as to how I should proceed.  Can I roll it all over or do I need to only rollover the $5500 and then take a distribution on the $0.24 and just pay taxes on that small amt?  Thanks.

  • #2
    You just ignore it. Convert it all.
    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


    • #3
      Convert it all over, it will be a rounding error on next year's taxes.

      A more common scenario is to receive a dividend or capital gain of a several cents in your traditional IRA after converting.  If this happens, Vanguard will automatically sweep it into your Roth in a few months.


      • #4
        WCICON24 EarlyBird
        100% conversion.  You will be ok.