Can the earnings on a Roth 457(b) plan that has not been in existence for 5 years be rolled over to a Roth IRA tax free?
Can the earnings on a Roth 457(b) plan that has not been in existence for 5 years be rolled over to a Roth IRA tax free? There will be no Roth IRA distributions until the 5 year period has been met for the Roth IRA.
Permalink Submitted by Alan - IRA critic on Wed, 2024-04-10 19:40
Yes, a direct rollover of a designated Roth balance to a Roth IRA is never taxable. In this particular situation, if this is the first Roth IRA the amount of any Roth 457b contributions will be treated as regular Roth IRA contributions, once in the Roth IRA. Roth 457b earnings will be treated as Roth IRA earnings, and such earnings will not be tax free until the Roth IRA becomes qualified (age 59.5 and 5 years).