Our new 401K plan (Fidelity administers it) allows after-tax contributions and contains an in-service withdrawal provision for those contributions. We may withdraw all or part of after tax contributions plus earnings effective as of the beginning of a calendar quarter. So, I'm exploring the "back door Roth" option. I already contribute the 401K max on a pre-tax basis and I'm maxing out my Roth IRA (held with TIAA-CREF).
I've read on this site and elsewhere. I've talked with Fidelity and am hopefully going to talk soon with my TIAA-CREF rep as well.
In sum, because I am the payroll accountant, I know how the funds will be deducted from my check and how they will get to Fidelity.
Because I've talked to Fidelity I know how the funds will be segregated in my account and how I can request a distribution of them for TIAA-CREF/Roth IRA.
It is from here that I get nervous about something going wrong. At the point I request the distribution how will I segregate earnings from contributions, do the appropriate conversion paperwork for TIAA-CREF, and not muck things up so I have bad unintended long-term consequences??? I assume I will pay tax on any earnings (which will hopefully be minimal)??
Just a little background on my Roth -- I started it over 15 years ago. Some of the initial funds were from IRA conversions, but I haven't done any conversions since then. I understand that since all Roths are treated as one that I automatically meet the 5 year test, but things get murkier for me with respect to the five year rule and also penalties with early withdrawals when you start bringing over converted funds.
Of course, I would think my TIAA-CREF rep could help me sort this out, but I don't expect that he deals with it quite often...