Tax law changes

Hi Loufurut,

 

This is a great question.  The IRS limits one rollover per year.  There is no income limits or filing status restriction for rollovers.  It is basically moving accounts around within the same financial institution.

 

401(k) to Roth will incur a taxable event.  401(k) is generally from your employer sponsored plan and converting to Roth will incur a taxable event.

 

I would ask the Administrator of the 401(k) plan about the conversion to Roth.  Some plans do not permit while actively employed unless you have attained age 59 1/2 or until you separate from that job prior to age 59 1/2.

 

Both traditional to Roth and 401(k) to Roth will incur taxable events.  Based upon my research, I did not locate anything that prohibits such conversions, but for rollovers, it is one per year 401(k) to Traditional and Traditional to Roth.  My suggestion would to speak to the Plan Administrator(s) about conversions.  Each situation is unique and varies from person to person.

 

Let me provide you some resources about IRAs.

 

https://www.irs.gov/publications/p590a

https://www.irs.gov/retirement-plans/plan-participant-employee/rollovers-of-retirement-plan-and-ira-...

 

Hopefully these links above provide more clarification to help you with an informed decision.  We wish you well.

 

 

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