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Level 3
posted Mar 17, 2024 8:34:04 PM

Ex-employers pension rollover with other IRAs in consideration

Hello, I would like to move my previous employers pension amount (they contributed to it , I never did) to a 401k or IRA. I am also doing mega backdoor to 401k Roth with intent to initiate Roth IRA for more flexibility of investments. What are my best options for the pension so that it does not trigger tax implications. Thanks!

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1 Replies
Level 15
Mar 19, 2024 8:39:05 AM

Assuming the pension is a "qualified" plan, see this chart.

https://www.irs.gov/pub/irs-tege/rollover_chart.pdf

 

You can roll it over to almost any other type of retirement account.  Of course, if you rollover a pre-tax plan to a Roth account, that is a taxable conversion.  If you don't want to pay tax, you will roll it over to another pre-tax account.  To avoid problems with withholding, do a direct transfer between the 2 plans rather than having the pension send you a check that you forward to the new plan.