457 rollover question
Can a 457 account be rolled over and how does it differ from rolling over a 401K account? Client is retired, age 64. Would you roll the 457 to a traditional IRA or open a 457 account at the receiving custodian? Are there benefits to leaving it as a 457 when you roll it?
Thank you.
Permalink Submitted by Alan Spross on Mon, 2011-04-04 21:08
Since client is retired, the only options are to keep it in place, convert it to a Roth 457b with current plan if administrator allows, or roll it over to a TIRA or Roth IRA as a taxable conversion.
A direct rollover to an IRA is the best option unless client has a TIRA with considerable non deductible basis in it and wants to convert to a Roth IRA. Since client is past 59.5, the early withdrawal penalty from an IRA is not a factor. Client cannot roll this over to another 457b since he is not working. If he returned to work with a govt firm, then he could roll it over to the new 457b plan.
Permalink Submitted by BruceM on Mon, 2011-04-11 04:15
Was the employer a government or a non-profit organization?
BruceM
Permalink Submitted by Kathy Patterson on Mon, 2011-04-11 17:35
City government.