[quote=”theo.tsavousis”]Hi I have just joined this discussion group and have a question relative to a 401K. It has several “wrinkles” and hopefully someone has had a similar problem previously.

I am a Bahamian citizen who worked in the US with an L-1 Visa and participated in my employers 401K plan. I have since moved back to The Bahamas but did not “close out” my plan.

Once I returned I could no longer contribute as I was working as a “local” and contined with the 401K in the US. The value of the 401K has appreciated in the intervening years.

As I understand it I can no longer contribute to the 401K nor can I cash-out without significant penalties.

[b]Is there a way to cash-out and pay the taxes and penalities up to the date I left the US rather than on the current appreciated value to a ROTH IRA?[/b]
Thanks
Theo[/quote]
No. Any taxes and/or penalties assessed on a distribution is based on the value of the distribution as of the close-of-business the day the distribution is processed…or the valuation date as stated under the plan.
If you convert the funds to a Roth IRA, the [url=http://www.retirementdictionary.com/Early-distribution-penalty.htm%5Dearly distributions penalties[/url]will not apply to the amount.

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