Conversions at Retirement Plan Levels

Submitted by Vickie Intriago on Tue, 2019-07-09 01:48

Client has over $2,500,000 in 457 and 401k plans from previous employer. He is considering converting some monies into ROTHs. Is that possible at the qualified plan level? Or, is the only way to convert these assets is if client transfers account to IRAs?



Submitted by Alan - IRA critic on Tue, 2019-07-09 02:21

If these plans include designated Roth accounts AND in plan Roth rollovers, the pre tax amounts in those plans could be converted to Roth within the plans. Otherwise, a direct rollover to a Roth IRA would be required.

Submitted by William Tuttle on Tue, 2019-07-09 11:38

  • If an IRR is not an option.
  • Some 401k and many 457b plans do not allow discretionary partial distributions.
  • The plans only allow RMDs, periodic fixed distributions and/or full distributions.
  • If discretionary partial direct rollovers to a Roth IRA are not allowed the only choice may be to do a full direct rollover to a traditional IRA and do Roth conversions from there.

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