- 1). Request a distribution from your other qualified retirement account, such as a 401k plan, traditional IRA or 403b plan, by completing a distribution request form, available from your financial institution. You will need to include your identification and your account information.
- 2). Receive 80 percent of the amount of the withdrawal you requested. Your financial institution must withhold 20 percent for tax purposes. However, you will be responsible for redepositing 100 percent of the amount requested. If you fail to redeposit the entire amount, the undeposited amount will be counted as a distribution.
- 3). Redeposit the money within 60 days to complete the rollover to a Roth IRA. If you do not redeposit the money within 60 days, the money will be considered distributed.
- 4). Complete form 8606 to calculate the taxable amount of your Roth IRA rollover. Unless you have made nondeductible contributions, the entire amount will be taxable.
- 5). Report the amount of the conversion on your income taxes using form 1040. On line 15a, report the total amount of the rollover. On line 15b, report the taxable portion of the rollover. The taxable portion will be added to your taxable income. On line 61, report the total amount withheld by your financial institution. This amount will reduce your tax liability.
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