RMD and 401K Rollover

Submitted by yvon araktingi on Mon, 2014-08-11 21:22

I am presently employed and I am 70 years and 11 mos old. I have 2 401K accounts:
1-with my previous employer at Prudential
2-with my current employer at X
Yesterday, and for the first time ever, I received a notice from Prudential about the RMD. My current employer plan ,X, does not require an RMD as long as you are employed and not yet retired. My questions are:
1-Can I rollover my Prudential 401K account into my current 401K account at X,and thus avoid the RMD? If that is not possible,
2-What are my options to avoid the RMD? I plan to retire in 5 years.



Submitted by Alan - IRA critic on Mon, 2014-08-11 22:49

  1. If your current plan will accept a direct rollover from the Prudential plan, you can avoid future RMDs from the Prudential assets, but you cannot avoid the 2014 RMD. The 2014 RMD must be distributed to you and cannot be included in the rollover to the current plan. But this will avoid future RMDs in 2015 and beyond as long as you continue working through year end.
  2. If the above rollover cannot be done, you cannot avoid the Pru RMDs, so you might as well do a direct rollover to a rollover TIRA in that event. Probably unlikely, but it is possible your current plan will accept IRA rollovers but not rollovers from other qualified plans. In that event, you could route the Pru through your IRA to the current plan.

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