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Consolidating 403b

If you have a 457 deferred compensation plan with a government employer, you are now eligible to roll over distributions tax free to a traditional IRA, as well as to a 401(k), 403(b), or 457 governmental plan that accepts rollovers.

Furthermore, if you roll over your governmental 457 plan to a traditional IRA, 401(k), or 403(b) plan, your 457 savings becomes subject to those plans.In contrast, you are free to make withdrawals anytime from your IRA, even though you have to pay the federal income taxes owed and any 10% early withdrawal tax.However, rolling over your traditional IRA or employer retirement plan to your governmental plan doesn't mean these assets are no longer subject to the 10% early withdrawal tax.If you don't go the direct route, you'll receive a check payable to you and you'll have 60 days to reinvest your money in a traditional IRA or eligible retirement plan.Your check, however, will be reduced by 20% because federal tax law requires your former employer to withhold that amount as prepayment for federal income taxes.

A: You are able to make a direct trustee-to-trustee rollover from your governmental 457 plan to a traditional IRA or eligible retirement plan.

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Consolidating 403b introduction

Consolidating 403b

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