Financial Planning for Generation X & Y Women
 
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Expert Q&A Archive

03/11/2009
Is it possible to roll funds from a Roth IRA into a traditional IRA?
If you have a Roth 401(k) through your employer, can you roll those funds over into a traditional 401(k) or can they not be moved from plan to plan?
Lynn Anne Gillen, CIMA® :
expert info »
Roth 401(k) funds must stay in that account. If you leave your job, then you may roll those funds into a Roth IRA. The funds cannot go into a Traditional IRA because they have different tax status.
Rosemary Ervin, CPA:
expert info »
The Roth can be rolled just as any IRA; however, you never want to roll a Roth to a regular IRA because you have already paid tax on the Roth, and the growth and income [on a Roth] are never taxed. If you have a new employer with a 401(k) Roth plan, you can roll it there. Otherwise, just open a Roth IRA and roll the 401(k) Roth plan there.
Joan Koonce, Ph.D:
expert info »
As employer plans differ, it is important to check with your employer for specific rules regarding what can be done with different retirement plans; however, typically funds in a Roth 401(k) can be rolled over into another employer's Roth 401(k) or a Roth IRA, but not a traditional 401(k). Distributions from one Roth 401(k) to another must be done through a direct rollover. Special rules apply if it is not a direct rollover. If the distribution from the Roth 401(k) is made directly to the employee and rolled over within 60 days, the portion of the distribution that are contributions cannot be rolled over into another Roth 401(k), but can be rolled over into a Roth IRA.
Alyssa Rakovich:
expert info »
If you have a Roth 401(k) through your employer, can you roll those funds over into a traditional 401(k) or can they not be moved from plan to plan? No. Roth stays Roth, but you can convert Traditional to Roth. Why would you want something that comes out tax free [the Roth] to come out taxable [traditional]?
Michael A. Masiello:
expert info »
Michael A. Masiello
You should not. The Roth is funded with after tax $$, never taxed again. The 401(k) or IRA is pre-tax, meaning [tax] deductible contributions, fully taxed when taken out. Don't comingle these funds/accounts. Mike
Editor's Note:
Editor’s Note: See the publication What You Should Know About Your Retirement Plan from the Website of the Employee Benefits Security Administration at www.dol.gov/ebsa/publications/wyskapr.html and the publication Tax Topic 413 – Rollovers from Retirement Plans – on the Internal Revenue Service Website at www.irs.gov/taxtopics/tc413.html.
 

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