The IRS rollover chart shows that you can't roll a Roth IRA over to a Roth 401(k), even though it's totally normal to roll over a traditional IRA to a traditional 401(k). There probably aren't very many reasons why someone would WANT to do a Roth IRA -> Roth 401(k) rollover, but still, the asymmetry is odd. (The best reasons I can come with are that someone might want fewer accounts to manage, or maybe their employer plan might offer access to some awesome investment that they can't get anywhere else.)
Is it just an arbitrary fluke of the tax code, since Roths are uncommon and newer than traditional? Or is there some actual rationale for forbidding that kind of rollover?
Why can't you roll over a Roth IRA to a Roth 401(k)?
byu/herodotus479 inpersonalfinance
Posted by herodotus479
3 Comments
The main reason is that Roth IRAs have way more flexible withdrawal rules than Roth 401(k)s – you can pull out contributions anytime penalty-free from a Roth IRA but not from a 401(k). The IRS probably doesn’t want people using rollovers to lock up money that was previously more accessible, especially since most employer plans have fewer investment options anyway
It’s the law. Rumor is that it may be part of the next big pension bill (likely SECURE 3.0 from what I hear), but guessing it’ll be 2027 or 2028.
Why would you want to?