如果你离职或退休, you might want to transfer the money you’ve invested in one or more employer-sponsored retirement plans to an individual retirement account (IRA). An IRA rollover is an effective way to keep your money accumulating tax deferred.
使用IRA滚动, you transfer your retirement savings to an account at a private institution of your choice, and you choose how you will invest the funds. To preserve the tax-deferred status of retirement savings, the funds must be deposited in the IRA within 60 days of withdrawal from an employer’s plan. To avoid potential penalties and a 20% federal income tax withholding from your former employer, you should arrange for a direct, institution-to-institution transfer.
You are able to roll over assets from an employer-sponsored plan to a traditional IRA or a Roth IRA. Because there are no income limits on Roth IRA conversions, everyone is eligible for a Roth IRA conversion; however, eligibility to contribute to a Roth IRA phases out at higher modified gross income levels. Keep in mind that ordinary income taxes are owed (in the year of the conversion) on all tax-deferred assets converted to a Roth IRA.
An IRA can be tailored to your particular needs and goals and can incorporate a variety of 投资 vehicles. Although IRAs typically provide more 投资 choices than an employer plan, your plan may offer certain 投资s that are not available in an IRA. 进一步, the cost structure for the 投资s offered in the plan may be more favorable than those offered in an IRA. In addition, tax-deferred retirement savings from multiple employers can later be consolidated.
随着时间的推移, IRA rollovers may make it easier to manage your retirement savings by consolidating your holdings in one place. This can help cut down on paperwork and give you greater control over the management of your retirement assets.
Keep in mind that you may be able to leave your funds in your previous employer plan, 如果计划允许的话. You may be able to transfer the funds from your previous employer plan to a new employer plan (if it accepts rollover funds). While you can withdraw the funds from your employer plan as a lump sum, you could incur a potentially sizeable income tax liability in the tax year of the withdrawal and your funds would not be able to continue growing tax-deferred.
Distributions from traditional IRAs are taxed as ordinary income and may be subject to a 10% federal income tax penalty if taken prior to reaching age 59½. Just as with employer-sponsored retirement plans, you must begin taking required minimum distributions from a traditional IRA each year after you turn age 72.
Qualified distributions from a Roth IRA are free of federal income tax (under current tax laws) but may be subject to state, 当地的, 以及替代性最低税. To qualify for a tax-free and penalty-free withdrawal of earnings, a Roth IRA must meet the five-year holding requirement and the distribution must take place after age 59½ or due to death, 残疾, or a first-time home purchase ($10,000一生最大). The mandatory distribution rules that apply to traditional IRAs do not apply to original Roth IRA owners; however, Roth IRA beneficiaries must take mandatory distributions.
The information in this newsletter is not intended as tax, 法律, 投资, or retirement advice or recommendations, and it may not be relied on for the purpose of avoiding any federal tax penalties. You are encouraged to seek guidance from an independent tax or 法律 professional. The content is derived from sources believed to be accurate. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. This material was written and prepared by Broadridge Advisor Solutions. © 2021 Broadridge Financial Solutions, Inc.