I've done some searching on this thread, along with others. I'm pretty sure my situation works (without excess taxation). I'm looking for feedback in regards to documenting. I'm somewhat confused in terms of what is designated as a distribution and "basis" for purposes of filling out an 8606.
https://www.irs.gov/pub/irs-tege/rollover_chart.pdfSo here's the situation:
In January I did my yearly 5500 contribution to traditional IRA (using taxed wages), to which I converted to a ROTH in the same year (textbook backdoor ROTH conversion).
About a month later I took up employment closer to home and family. The 401k wasn't available to me and I was under the impression that I had to make a decision within 60 days of leaving employment. I kept getting hounded by Fidelity to invest the pretax 401k into a trad IRA with them. Long story short, I rolled into the IRA used to make backdoor conversions.
Looking into this further, I came to realize that the only way I can keep doing backdoor ROTH conversions is by having a basis of zero from year to year (i.e. keeping nothing in the traditional IRA itself). With that said, I am in the process of yet again, rolling those funds over into my current employers pre-tax 401k.
So here are my questions:
1) is my backdoor conversion still ok from this year? I would presume so, since the 8606 form looks at basis from last day of the year. Plus the transactions occurred in such a manner that they weren't in the IRA at the same time.
2)What part of any of this is considered a distribution? What about basis? Im fearful that since the money was technically moved twice it'll somehow look like something isn't accounted for.
3)Any idea how difficult this is going to be to get across when filing taxes next year?
I get that there are a bunch of moving parts to all of this, I hope I explained this well and I sincerely appreciate any advice