How to Mega backdoor Roth at Fidelity?

[Steeze]

According to the plan documents DW’s plan allows in-service rollovers to a Roth for after-tax contribution accounts.

Only thing is, I do not see anything on how to contribute to an after tax account. There is the regular 401k and Roth 401k options, but nothing about actually contributing to an after tax account.

I can set the contributions to some high percentage like 50%, but it just stops making contributions once you hit the limit (19,500). There is a true up feature at least.

Am I missing something?

1. Max out 401k
2. Contribute additional $$,$$$ to an after tax account
3. Make in-service withdraw/rollover to Roth IRA

Anyone actually doing this successfully? How are you contributing to the after tax account? Is it only an option once the 401k is already maxed out?

Thanks!

[shuffler]

Anyone actually doing this successfully? How are you contributing to the after tax account?

My 401k is with Fidelity.

401k Account -> "Change Contributions" -> "Contribution Amount"

It then presents me with %-of-salary options for each of Pre-Tax, Roth, and After-Tax contribution types.

Below the input-boxes for the percentages, there's another section for Roth Conversion, in which I've chosen to have my After-Tax contributions converted to Roth on a daily basis.

... so if you're not seeing that, then either it's not offered (despite what you read?), or maybe it's not set up correctly between Fidelity and DW's workplace.

Am I missing something?

1. Max out 401k
2. Contribute additional $$,$$$ to an after tax account
3. Make in-service withdraw/rollover to Roth IRA

#1 is not related to #2/#3.  Meaning that you can do after-tax and Roth conversions first, if you like.  There's no dependency/ordering issue.

[Steeze]

Thanks, I think that explains my frustration.

When I go to “contribution amount” to change the %, it only has pre-tax and Roth as options. Suppose they do not allow after tax then, despite having the rollover option in the literature.

[MDM]

According to the plan documents DW’s plan allows in-service rollovers to a Roth for after-tax contribution accounts.

When I go to “contribution amount” to change the %, it only has pre-tax and Roth as options. Suppose they do not allow after tax then, despite having the rollover option in the literature.

Appears the time is ripe for DW to ask her employer how she can do an in-service rollover to a Roth from her after-tax non-Roth account, if she isn't able to contribute to the after-tax non-Roth account in the first place.

Wish her good luck!

[MustachioedPistachio]

Below the input-boxes for the percentages, there's another section for Roth Conversion, in which I've chosen to have my After-Tax contributions converted to Roth on a daily basis.

Hey shuffler, did you have to call Fidelity to set this up or was it already an option?

Thanks!

[shuffler]

Below the input-boxes for the percentages, there's another section for Roth Conversion, in which I've chosen to have my After-Tax contributions converted to Roth on a daily basis.

Hey shuffler, did you have to call Fidelity to set this up or was it already an option?

Thanks!

Years ago, my company sent out mail announcing that after-tax contributions and conversions to Roth had been added to the 401k plan.  At that time, we had to call and speak to a human at Fidelity to get them to do the conversion.  I used to call every quarter or so.

I don't remember exactly when, but maybe 2-3 years ago they sent more mail announcing that the conversions could be done automatically.
Lo-and-behold, that option showed up on the account's contribution page.  No more calls necessary.

So no, I didn't have to call and set it up.  It happened due to my company's management-of/updates-to the 401k plan.

[ericrugiero]

I have a Fidelity 401K and it does have all 3 options on the screen to choose from (pre-tax, roth and after tax).

I had to call Fidelity and have them set me up to roll the after tax contributions to roth immediately after I contributed.  Doing the rollover immediately prevents increased value before it hits the Roth so you don't have to pay taxes on those gains.  The rep told me they don't have the option to select this automatic rollover on their website.  It was set up this way because people can get themselves in trouble by rolling lots of money that has gained value and then they get a big tax bill.

You should definitely call Fidelity and ask them your options.  Some of them will depend how your company set things up with Fidelity.  I have called Fidelity 3 times with questions about my 401K or HSA and all 3 rank in the top 5 of my customer service experiences.  They were very knowledgeable and SUPER nice all 3 times.