When both pre-tax and after-tax contributions were used to purchase company stock in a 401(k), how is the stock handled when rolled to an IRA? It's my understanding that you can take stock as stock, pay ordinary income tax on what the stock cost and then when you later sell the stock pay capital gains on the profit. Is that stock held in the IRA? If so, the stock purchased with after-tax contributions obviously couldn't be in an IRA. How does it all get sorted out? In looking at old statements I can't tell which money went for specific shares of stock. Presumably some shares could have been purchased with money from both pre and after tax. Or would the custodian have made sure to avoid that? Would it be easier all around to (in effect) sell the stock while it's still in the 401(k)?

Any guidance will be much appreciated.