I want to fund my individual Roth 401k. Let's say $20k. Let's say it's held at Vanguard.
Question 1: I understand I can fund a Roth 401k with $20k worth of shares I already own in a taxable account. Is that correct?
Question 2: The price of the shares I want to move into the 401k is higher than when I bought them, so I have unrealized LTCG in those shares. If I move those shares from the taxable account to the Roth 401k is that a taxable event? I mean, could that be considered a "sale" of those assets or otherwise trigger LTCG tax liability now?
Could this affect the non-taxability of the qualified distributions from the Roth 401k?
I could just buy $20k of new shares to fund the Roth 401k. But my idea is to move the existing shares with the lower basis and unrealized gain into the tax-advantaged account and shield the gains by later taking them as qualified distributions.
How about it?