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Something else I just remembered which may help Neuromancer or others make a better decision than I did.

I was an HCE and my contributions exceeded some sort of threshhhold resulting in my 401K having some after tax money in it. I was offered the option of withdrawing the after tax component and only transfering the pre-tax value to the TIRA. Like an idiot, I told them to transfer it all. So I ended up with a tax basis in the TIRA and the blessing of a form 8606 for the past 18 years.


18 years ago, you were required to take your after-tax contributions either in cash or roll them into a T-IRA and create basis. The IRS did not clarify the ability to roll after-tax contributions into a Roth until 2014, through Notice 2014-54 https://www.irs.gov/retirement-plans/rollovers-of-after-tax-...

Since that clarification, you can roll after-tax contributions directly into a Roth IRA at the same time as rolling the pre-tax earnings and contributions into a T-IRA. It is also possible to roll pre-tax money directly into a Roth IRA, although not all plan administrators like to do that, and some may require a 2 step process, into a T-IRA and then from the T-IRA into a Roth IRA.

That said, back in the 90s, I took my after-tax contributions in cash, rather than create basis in my T-IRA.

AJ
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