Tax forms required for mega backdoor Roth in-plan rollover

Tax forms required for mega backdoor Roth in-plan rollover
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#1

Last year, I did an in-plan rollover on ~$3,000 of after-tax contributions within my 401k to the Roth 401k portion of the same account. This resulted in $85 of taxable gains, which was reported to me on a 1099-R with code G.

In trying to enter this into CreditKarma to finish my taxes, all references of how this was handled point to a Roth IRA conversion, not an in-plan rollover. I believe the taxes are calculated correctly (roughly equivalent to my marginal tax bracket in additional tax owed on the $85). However, CreditKarma is also filling out a form 8606 as it believes this is an IRA conversion that needs to be reported. Is an 8606 required in this circumstance? Is there another form that I need to submit outside of the additional $85 listed on line 4b of my 1040? What amount should be listed on line 4a - the additional $85, or the full ~$3,000 that was converted?


#2

Hi, @dmbaty. I’ve done several of these in-service distributions and never received a tax form, so I haven’t a clue how to help you. I’ve also noticed that not every tax pro is up-to-date about how these mega-backdoor Roths work – I even had one tell me that in-service distributions weren’t possible, after I’d done three of them – so you may need to file an extension and hunt down one that is if nobody on the forum can offer guidance.