We have a client who just retired. During the client’s working life he participated in a 457 Deferred Compensation Plan. Now that he is retired we are analyzing all payout options under the plan including a rollover to an IRA. The client has 3 different contribution categories shown on his statement, they are as follows:
1. Regular Pre-Tax
2. Roth
3. Pre-tax Contribution made before 1992
Our question is this, is there different tax treatment or any favorable tax treatment associated with the pre-tax contributions made prior to 1992? We find it odd that they would be listed out separately from the other pre-tax contributions. The client has tried to ask the plan sponsor these questions, but does not get any helpful feedback. We have also tried researching on our own. Any feedback would be very helpful, thanks!”