ThunderDrop t1_iuftm26 wrote on October 31, 2022 at 12:14 AM

I assume your previous employer had some sort of contribution matching. Something like if you put in at least 3% of your paycheck, they will match with another 3% of extra money.

While you chose to make your contributions Roth(after tax), employer contributions are always traditional(pre tax).

These funds have to go into the correct types of accounts. Traditional into traditional and Roth into Roth or you will make a mess of your taxes.

bulls2030 OP t1_iufttvv wrote on October 31, 2022 at 12:16 AM

Yes they did have contribution matching. Oh i see. I didn't know that. So would it make sense to rollover the pretax contributions to my Roth IRA or open a Traditional one?

ThunderDrop t1_iufutzw wrote on October 31, 2022 at 12:24 AM

That really depends on two things.

If you would rather pay income tax on those employer contributions this year or in some future year. Basically if you think you will be in a lower tax bracket now or later.

And if you think your income will ever be large enough that you will no longer be able to directly contribute to a Roth IRA and will want to use the "backdoor" method. (currently $140kish for single and $220kish for married) if you think you will use the backdoor someday, the existence of an old traditional IRA complicates things.

DeluxeXL t1_iufu2nh wrote on October 31, 2022 at 12:18 AM

If you are in 22% or higher tax bracket, you should roll over traditional 401k to traditional IRA or traditional 401k at your new job.

manwnomelanin t1_iuga29y wrote on October 31, 2022 at 2:22 AM

OP, i just did this and i just decided to make it easy and put it into a traditional IRA.