One question that continues to come up is whether company retirement plan dollars are protected from creditors. This becomes an issue if you are forced to declare bankruptcy or you owe money after a legal action is brought against you.
Question:I am retired and turned 72 in September, 2021, so I must begin required beginning distributions (RMDs) by April, 2022. I have traditional and Roth IRAs as well as a defined contribution plan with a former employer. I understand I must withdraw my RMD before withdrawing an amount for anything else (e.g., Roth conversion) from both my traditional IRA and my defined contribution plan. But is that requirement limited to withdrawals within each type of plan (IRA and defined contribution)?
By Ian Berger, JDIRA AnalystFollow Us on Twitter: @theslottreport The Build Back Better Act of 2021, recently passed by the House...
Congress designed 401(k) plans as retirement savings vehicles – not as checking accounts. So, there are restrictions on when employees can make “in-service withdrawals” (i.e., withdrawals while still working).It’s important to remember that while 401(k) plans must abide by these withdrawal rules, plans are free to impose even more restrictive rules. So, you’ll need to check your plan summary or ask your plan administrator or HR rep for the particular withdrawal rules that apply to you.
Question:If your employer contributes to either a SEP IRA or a SIMPLE IRA, can you (the employee) also contribute to a Roth IRA?Regards,Alfred
Are you moving assets between IRAs or from a company plan to an IRA (or vice-versa)? You should know that using a direct transfer is a much better idea than doing a 60-day rollover. Direct transfers avoid all of the possible issues which can occur with 60-day rollovers:
By Ian Berger, JDIRA AnalystFollow Us on Twitter: @theslottreport What if you have an IRA with your spouse as primary beneficiary,...
Question:I am 72 years old and have a Roth IRA. I have some extra cash in a bank account. Can I put that into my Roth IRA and how much can I contribute for 2021?
In the August 16, 2021 Slott Report, we showed that someone participating in a 401(k) plan through a “regular” job could also establish a solo 401(k) plan through a side job and potentially contribute up to $58,000 this year in after-tax contributions to the solo plan. However, this only works if the company sponsoring the regular 401(k) plan and the entity sponsoring the solo 401(k) (e.g., a sole proprietor) are considered unrelated under IRS rules.
We continue to get lots of questions about the company savings plan contribution limits. There are actually two different contribution limits – the “deferral limit” and the “overall limit.” This makes things very confusing, especially if you’re in multiple plans at the same time or you change jobs in the middle of the year.
