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401K advice- how to transfer from company plan while still an employee?
Posted on 3/2/21 at 6:43 pm
Posted on 3/2/21 at 6:43 pm
Is it possible to convert an existing 401K (with both traditional and roth 401K balances) into a rollover IRA (with the roth 401K balance being converted into an existing roth IRA) while still being an employee of a company? If you convert a traditional 401K to a rollover IRA, does that mess up backdoor Roth contributions in the future (as you need traditonal IRA balances with zero gains to avoid tax issues)?
I am trying to get an avenue where I can invest in individual stocks in my 401K, which is not an option with company plans.
I am trying to move all of my investment assets to Fidelity. Have transferred brokerage accounts and H.S.A. and Roth IRA's, but the 401K is the last account to figure this out for.
Let's assume a second scenario: I leave my job to go to another job, but there's a month or so gap between the last day of my old job and the first day of my new job. Can I open up a solo 401K during that month and transfer the old employer plan over?
Thanks!
I am trying to get an avenue where I can invest in individual stocks in my 401K, which is not an option with company plans.
I am trying to move all of my investment assets to Fidelity. Have transferred brokerage accounts and H.S.A. and Roth IRA's, but the 401K is the last account to figure this out for.
Let's assume a second scenario: I leave my job to go to another job, but there's a month or so gap between the last day of my old job and the first day of my new job. Can I open up a solo 401K during that month and transfer the old employer plan over?
Thanks!
This post was edited on 3/2/21 at 7:11 pm
9
Posted on 3/2/21 at 6:51 pm to GeneralLee
401k and IRAs are totally different account types
I don’t know if anything like that is possible
I don’t know if anything like that is possible
Posted on 3/2/21 at 6:54 pm to GeneralLee
Most company-sponsored 401ks don't offer in-service rollovers, but you'll have to consult your plan document to be sure.
Posted on 3/2/21 at 6:55 pm to FinleyStreet
nm
This post was edited on 3/2/21 at 7:11 pm
Posted on 3/2/21 at 7:12 pm to GeneralLee
None of my companies would allow that. It is common that you have to leave the company before you can do a rollover out of your 401k.
Posted on 3/2/21 at 7:18 pm to notsince98
quote:
None of my companies would allow that. It is common that you have to leave the company before you can do a rollover out of your 401k.
I get this. But does anyone know if you lose the ability to do a backdoor Roth with no tax consequences if you have a rollover IRA with built in gains?
Posted on 3/2/21 at 7:19 pm to notsince98
quote:
None of my companies would allow that. It is common that you have to leave the company before you can do a rollover out of your 401k.
That's what I'm dealing with was able to roll my old 401k. New company after buyout has shitty options to pick from and the only way I can roll it over is to leave.
Posted on 3/2/21 at 7:22 pm to ReadyPlayer1
Sounds like my only option would be to leave my job and open up a solo 401K and transfer my old employer 401K into that?
Posted on 3/2/21 at 7:40 pm to GeneralLee
Doing some more research, looks like I should open up a solo 401K and then if I change jobs, I could transfer the old employer 401k into the solo 401K.
Posted on 3/2/21 at 7:44 pm to GeneralLee
You keep saying solo 401k, what you're looking for in this context is IRA.
Posted on 3/2/21 at 7:46 pm to castorinho
quote:
401K advice- how to transfer from company plan while still an employee?
You keep saying solo 401k, what you're looking for in this context is IRA
No, if I want to keep my ability to do backdoor roth IRA conversions, then I need to keep the old employer 401k in a solo 401K going forward, and these do exist.
Posted on 3/2/21 at 7:49 pm to GeneralLee
You can backdoors from an IRA
Posted on 3/2/21 at 7:59 pm to GeneralLee
You’re looking for an in service rollover. Call the company and ask if it’s offered and what are the restrictions
Posted on 3/2/21 at 8:13 pm to ReadyPlayer1
quote:
That's what I'm dealing with was able to roll my old 401k. New company after buyout has shitty options to pick from and the only way I can roll it over is to leave.
That’s pretty rare. Almost every company I’ve ever experienced will allow you to withdraw your rollover contributions from a previous plan.
Posted on 3/2/21 at 8:14 pm to GeneralLee
quote:
No, if I want to keep my ability to do backdoor roth IRA conversions, then I need to keep the old employer 401k in a solo 401K going forward, and these do exist.
If you keep your money in 401ks you can easily do backdoor Roth conversions. Are you being forced out of the old employer 401k? Otherwise your post makes no sense.
Posted on 3/2/21 at 8:52 pm to GeneralLee
quote:
I get this. But does anyone know if you lose the ability to do a backdoor Roth with no tax consequences if you have a rollover IRA with built in gains?
For the most part, yes. You can still do the back door but you lose some of the tax advantage depending on how much you have in the rollover IRA and how much you are trying to back door.
Posted on 3/2/21 at 8:56 pm to GeneralLee
quote:
Can I open up a solo 401K during that month and transfer the old employer plan over?
Thanks!
Starting a solo 401k solely for the purpose of rolling over your existing 401k without actually being self employed is a recipe for disaster with the IRS.
Posted on 3/2/21 at 9:07 pm to slackster
What if I have business related LLC’s of which I am the sole member and for which there are no full time employees? From what I’ve read that usually suffices for solo 401k eligibility.
Posted on 3/2/21 at 9:09 pm to GeneralLee
quote:
What if I have business related LLC’s of which I am the sole member and for which there are no full time employees? From what I’ve read that usually suffices for solo 401k eligibility.
Ask your CPA. Seriously, you’re trying to pull a rabbit from the hat that’s probably not worth it just to buy a few individual stocks IMO.
Posted on 3/2/21 at 9:13 pm to slackster
But those are the only two requirements listed with the IRS for solo 401 eligibility.... no full time employees and the presence of self employment activity (easily proven with an LLC). There are plenty of articles online talking about having a solo 401k while being fully employed elsewhere.
This post was edited on 3/2/21 at 9:15 pm
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