Permalink Submitted by Alan Spross on Tue, 2009-11-24 18:27
Not possible until he reaches the age where his plan will allow in-service distributions. For most plans it is age 59.5, but firefighters are likely to allow these at earlier ages, but probably not as young as 40.
Permalink Submitted by BruceM on Tue, 2010-11-09 20:59
The ability of a Government employer to offer a 457(b)-Roth or to allow inservice conversions from the 457(b) to the Roth, is per the Small Business Jobs Act, signed by the Prez on Sept 27, 2010 but won’t become effective for 457(b) plans until Jan 1, 2011.
As noted, this applies to Governement 457(b), which includes government funded educational institutions. It does not apply to non-government employers, which usually includes non-profit organizations, such as hospitals, foundations, charities, etc.
There are other issues involving in-service Roth conversions that are not yet resolved. The following is a discussion of this provision from Segal, a retirement plan consulting group.
Permalink Submitted by Alan Spross on Tue, 2009-11-24 18:27
Not possible until he reaches the age where his plan will allow in-service distributions. For most plans it is age 59.5, but firefighters are likely to allow these at earlier ages, but probably not as young as 40.
Permalink Submitted by James Arnold on Mon, 2010-11-08 15:49
I have a client who has a 457 plan with a former employer. Can he convert to a Roth IRA and stretch the tax over 2011 and 2012?
Permalink Submitted by Alan Spross on Mon, 2010-11-08 17:01
Yes, as long as the 457 is a GOVERNMENT 457b plan.
Permalink Submitted by James Arnold on Tue, 2010-11-09 13:33
Alan, do you know if a state college qualifies as a governmental agency for the 457 status?
Thanks
Permalink Submitted by Alan Spross on Tue, 2010-11-09 18:48
Yes, they ARE considered govt 457b plans.
Permalink Submitted by BruceM on Tue, 2010-11-09 20:59
The ability of a Government employer to offer a 457(b)-Roth or to allow inservice conversions from the 457(b) to the Roth, is per the Small Business Jobs Act, signed by the Prez on Sept 27, 2010 but won’t become effective for 457(b) plans until Jan 1, 2011.
As noted, this applies to Governement 457(b), which includes government funded educational institutions. It does not apply to non-government employers, which usually includes non-profit organizations, such as hospitals, foundations, charities, etc.
There are other issues involving in-service Roth conversions that are not yet resolved. The following is a discussion of this provision from Segal, a retirement plan consulting group.
http://www.segalco.com/publications-and-resources/public-sector-publicat…
BruceM