This is such valuable information! I'm in a similar situation at 29 with a Roth 401k through my employer. Reading through this thread has been incredibly enlightening - I had no idea about the prorating rule difference between Roth 401k and Roth IRA withdrawals. One thing I'm curious about: when you do the rollover, how do you track the contribution basis vs. earnings for tax purposes? Do the financial institutions provide clear documentation, or do you need to maintain your own records? I'm worried about accidentally withdrawing earnings thinking they're contributions and getting hit with unexpected taxes and penalties. Also, for anyone considering this strategy, I'd recommend double-checking with your current 401k provider about any rollover fees or restrictions. Some plans have waiting periods or processing fees that could affect your timeline.

This thread has been incredibly helpful! As someone who's been contributing to a Roth 401k for the past 4 years without fully understanding the withdrawal differences, I feel like I finally have a clear picture. One additional consideration I wanted to mention: if you're planning to do this rollover, timing can matter for tax purposes. I learned from my financial advisor that it's often best to complete rollovers early in the tax year so you have the full year to track any subsequent withdrawals properly. Also, for anyone worried about the complexity of tracking contributions vs. earnings after a rollover - most major brokerages (Schwab, Fidelity, Vanguard) have really good online tools that clearly show your contribution basis. They make it pretty foolproof to see what you can withdraw without penalties. The peace of mind knowing I can access my contributions in a true emergency while still keeping everything growing for retirement has been worth the rollover process. Just make sure you understand all the rules before making any moves!

Check your pay stub carefully to make sure "exempt" isn't checked somewhere. Sometimes if you write "EXEMPT" on your W4 (which you should only do if you had no tax liability last year and expect none this year), payroll will not withhold any federal income tax.

Don't panic! This is actually a pretty common issue and it's fixable. Since you caught it early (only 6 weeks in), you're in a much better position than if you'd discovered this in December. Here's what you need to do immediately: 1. **Get a new W4 from HR/payroll** - Tell them explicitly that federal income tax isn't being withheld and you need to correct this ASAP. 2. **When filling out the new W4**, be very clear about your filing status (Single) and consider adding extra withholding in section 4(c) to make up for what you've missed. For your income level (~$31K annually), you'll want to catch up on roughly $450-600 in federal withholding that should have been taken out already. 3. **Double-check your pay stub** after the next paycheck to confirm federal taxes are actually being withheld. The most likely culprits are: your employer entered your W4 incorrectly, accidentally marked you as "exempt," or there was a data entry error in their payroll system. This happens more often than you'd think, especially with new employees. Since you're fixing this now rather than at year-end, you shouldn't face any underpayment penalties as long as you get enough withheld for the remainder of the year. You've got this!

Something doesn't add up with your numbers. If the missed RMD was $5,695, the maximum excise tax penalty should be 50% of that, which is $2,847.50. But the IRS is asking for the full $5,695 plus penalties? Did you include the distribution on his tax return for 2022 (even though it was taken in 2023)? If not, the IRS might be considering this unreported income, which would explain why they're including the full amount as a tax increase. Also, I think you misunderstood what Form 5329 does. Lines 53-55 being zero means you calculated no penalty due (requesting a waiver). But you still have to report and pay tax on the RMD amount itself once it's distributed.

Just to add another perspective - my father missed his RMD two years ago, and we went through this same process. We had to: 1. Take the missed distribution immediately 2. File Form 5329 requesting a waiver of the 50% penalty 3. Include a letter explaining WHY it was missed (in our case, health issues) 4. File an amended return to include the missed RMD as income in the correct year The IRS initially sent a similar notice to what you received, but after we responded with a detailed explanation, they waived most of the penalties. We still had to pay the basic income tax on the distribution amount plus some interest, but they removed the failure to file/pay penalties. The key was providing a legitimate reason why it was missed and showing we corrected it immediately upon discovery.

Hey, quick question - if I have ADRs from multiple countries, do I need to separate the Foreign Qualified Dividends by country? My broker's statement shows foreign tax paid from 3 different countries.

This is a great thread with lots of helpful info! I just wanted to add one more practical tip for anyone dealing with this situation - don't forget to check if your ADR company provides annual tax information packets. Many foreign companies that issue ADRs will send out detailed tax information documents to ADR holders around tax season that specifically break down qualified vs non-qualified dividends and foreign tax withholding by country. These are often posted on the company's investor relations website under "Tax Information" or "ADR Tax Documents." I found this out the hard way after spending hours trying to get info from my broker, only to discover the company had already published everything I needed in a nice PDF document. Some companies even provide pre-filled forms or worksheets that make the whole process much easier. Worth checking before going through all the hassle with brokers!

Don't make this more complicated than it needs to be! Here's the simple version: 1) If anyone in the household has a regular medical FSA, nobody in the household can contribute to an HSA 2) If the FSA is limited to just dental/vision, then HSA is still allowed 3) If the FSA is "post-deductible" (only kicks in after meeting deductible), HSA is still allowed I went through this whole mess last year. Ended up having my wife decline her FSA so I could max out my HSA since the HSA has better long-term benefits (investment options + no "use it or lose it" rule).

Just wanted to add another perspective for folks dealing with this FSA/HSA household issue - timing matters a lot for your decision! If you're currently in a situation where your spouse has a regular FSA that's disqualifying you from HSA contributions, don't forget that you can make changes during your spouse's next open enrollment period. Most companies have open enrollment in the fall for the following year's benefits. Also worth noting: if your spouse has a qualifying life event (like job change, birth of child, etc.), they might be able to switch from a regular FSA to a limited purpose FSA mid-year, which could open up HSA eligibility for you sooner than waiting for the next enrollment period. The key is planning ahead since these accounts have different contribution deadlines. HSA contributions can be made up until the tax filing deadline (usually April 15th), but FSA elections are typically locked in during open enrollment and can't be changed without a qualifying event. One strategy that worked for my family: we calculated the total tax savings from both scenarios (spouse FSA + my regular health plan vs. spouse limited FSA + my HSA) and found the HSA route saved us about $800 more per year, especially since we can invest HSA funds for long-term growth.