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    Rollover?

    In 2017, A millennial, changed jobs and got a $1100 check from his 401k. The total amount was $1500 with $400 withheld for taxes. He took the $1100 and within 60 days rolled it to a Roth. If he recharacterizes it then he owes tax and penalty on $400. If he does not recharacterize it then doe she owe tax and penalty on the entire $1500? Any other solutions?

    #2
    Originally posted by Kram BergGold View Post
    In 2017, A millennial, changed jobs and got a $1100 check from his 401k. The total amount was $1500 with $400 withheld for taxes. He took the $1100 and within 60 days rolled it to a Roth. If he recharacterizes it then he owes tax and penalty on $400. If he does not recharacterize it then doe she owe tax and penalty on the entire $1500? Any other solutions?
    If converted to a Roth, the 1,500 would be taxable but only the 400 would have penalty. Unless the young person is in a very high tax bracket, Roth is the way to go IMO.

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