403b
Retired individual age 66 has funds in a 403b some in pre-tax which he wants to roll in a traditional IRA. He also has more money in the 403b but after-tax.
Can he roll the after tax directly in a Roth IRA tax free since the funds has already been taxed? What are his options? Advantages and disadvantages with this money?
Permalink Submitted by Alan - IRA critic on Fri, 2015-01-23 04:28
As a result of recent IRS Notice 2014-54, he should be able to direct the destination account as his Roth IRA for the after tax amount in the plan and his TIRA for the pre tax balance in the plan. These two direct rollovers must be ordered at the same time in order to be treated this way. The after tax contributions cannot be distributed without pre tax amounts in this manner (other than pre 1987 after tax contributions). But there is no need for a separate distribution if the post tax and pre tax can be directed to Roth and TIRA accounts respectively.