How can we rollover a traditional IRA into a back door Roth IRA?

My husband transferred his 401k to a traditional IRA in Nov 2015. Can he still transfer it to a back door IRA?

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June 2017

Yes. Anyone, regardless of income, is eligible to convert his or her Traditional IRA into a Roth IRA. You can do this quickly and simply with a low-cost ETF portfolio in a managed account at Betterment (after initial setup, add a Roth IRA account then start a rollover).

Important things to note:

  • If you would like to complete a conversion for the 2017 tax year, the IRS requires that the conversion completes by December 31, 2017. Please note, if the last day of the year falls on a weekend, the conversion needs to be completed during market hours on the last business day of the year.
  • Betterment does not withhold taxes for you, because it reduces the amount of money that can grow tax-free in your Roth IRA.
  • Generally, any funds you convert from Traditional to Roth which were previously deducted will be subject to income tax. Since Betterment cannot provide specific tax advice, we recommend you consult a tax advisor and the IRS Publication 590.

Please note that if you live in Michigan, there are special requirements for completing your conversion.

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