401k Rollover at age 59 and 1/2

We had a scenario come up recently where a client wants to roll over their 401k and is 59 and 1/2. The 401k company will not allow this to happen due to the fact that they are not old enough. I thought that there was a rule that recently passed allowing people who are 59 and 1/2 or older to roll over their 401k. Can you provide us with any evidence/support of such a rule so that we might be able to work this out?



Any allowed distribution prior to separation is at plan discretion. While many plans do allow this at 59.5, there are probably a comparable number who do not. The IRS does not have a firm requirement on 401k distributions prior to separation from service.

If the plan indicated the client was “not old enough”, that suggests that they might have another threshold other than separation from service.



Add new comment

Log in or register to post comments