Post tax | Ed Slott and Company, LLC

Post tax

Same question different version: Im 57 and got a post tax check from a 401K. I do not think it can go into a ROTH since it was not a Roth 401k or Roth IRA contributions. THere was no ROth IRA at the time of the contributions. Assuming i should not roll it into an IRA rollover...Can i just put it in the bank in a regular account? im under 59 1/2 so im wondering if i'll get hit with tax and 10% penalty? Thanks appreciate it.

As indicated in other post, you have a choice. You can either deposit this check into your bank account or roll it into your Roth IRA. Either way, there is no tax or penalty. Rollovers from 401k plans to your Roth IRA have been allowed since 2008. They are "qualified rollover contributions".  Many people are making after tax 401k contributions and then rolling them to their Roth IRA, especially those whose incomes are too high to make regular Roth IRA contributions. This strategy is referred to as a "mega back door Roth". You might google it.

 

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