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problem with backdoor roth

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  • problem with backdoor roth

    I recently funded by tIRA for backdoor roth conversion.  In the few days it took for the tIRA to become available to convert, it grew $1.58.  After reading the advice on WCI, I converted the full amount in the tIRA (including the extra $1.58) to the roth.  Here's the problem:  in the few days it took for vanguard to execute the conversion, the money in the tIRA grew another $1.60, which it left behind.  Now I have a tIRA with $1.60.  What should I do with that money in the tIRA?  Do I just convert it again to the roth?

  • #2
    Convert that too. This is common.

    https://www.whitecoatinvestor.com/pennies-and-the-backdoor-roth-ira/

    You’ll pay tax on the $3 earnings

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    • #3
      Interesting. Vanguard gives you the option to convert all. Did you click that?
      Anyways, hypothetical 24% x $3 = $0.72.
      The IRS rounds up. You're out an extra 0.28.

      It's fine.

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