401(k) | Ed Slott and Company, LLC

401(k)

401(k) Plans & IRA Custodians: Today's Slott Report Mailbag

Question: If you are an employee who participates in a 401(k) who retires at age 73, do you have to take an RMD in the year you retire, or can you take your RMD by April 1 of the year following retirement? If you can take your RMD by April 1 of the following year, does that mean you have to take two RMDs in that year?

Active Participation and IRA Deductibility

This question (or a derivation of it) has been popular as of late: “I only participated in my 401(k) for a couple of months in 2020 before I was laid off. Does that still make me a ‘covered’ employee, and can I contribute to my Traditional IRA?” It seems innocent enough, but there is a heck of lot going on in this little question.

When a “Reverse Rollover” Makes Sense

When we think of rollovers, we normally think of moving funds from a 401(k) (or other company plan) to an IRA. But it sometimes makes sense to consider a “reverse rollover” – from an IRA to a 401(k).

Do You Know All the Rules for Rolling Over a Roth 401(k)?

This week's Slott Report Mailbag examines 401(k)s, Roth 401(k)s, and spousal beneficiary rules.

Can I Open a Roth IRA and Fund it with my IRA?

This week's Slott Report Mailbag examines ERISA creditor protection differences for 401(k)s and IRAs and answers a consumer's question on funding a Roth IRA.

A Tale of Two IRAs: Using a Series of Substantially Equal Periodic Payments to Fund an Early Retirement

Multiple studies suggest that we often end up retiring earlier than initially anticipated or hoped. One study by JPMorgan Asset Management found that although two-thirds of current workers plan to continue working until age 65, fewer than one in four actually manage to do so. Although the reasons vary, premature retirement poses a two-fold portfolio stress - a shorter accumulation time and a longer withdrawal period. It also presents a potential tax complication when you've not reached 59 ½ - that magic age at which you can withdraw retirement money without an additional 10% premature distribution penalty.

What Now? A Widow's Story About Making the Right Financial Decisions

In 2006, Alan, a strapping young man who had just turned 50, collapsed and died of a massive heart attack while attending Sunday morning Mass with his wife Karen. Alan and Karen co-owned a business. Alan was a contractor and Karen handled the accounting and billing. Karen was fairly savvy financially. However, because she felt she had to get everything settled “right away” after Alan’s passing, she made several costly mistakes. It's a story you and your clients can learn from.

Relief for Victims of the Louisiana Floods: An Easing of Rules for Hardship Distributions and Loans from Employer Plans

On August 30, 2016 IRS released Announcement 2016-30 that allows for streamlining employer plan loan procedures and liberalizing hardship distribution rules for most employer plans. The following procedures are in effect until January 17, 2017 for victims of the storms and flooding in Louisiana that began on August 11, 2016.

Think You Are Debt Free If You Own an IRA, 401(k), or 403(b)? Think Again

While reasonably basic to an IRA specialist, the 9 ideas below are often overlooked by consumers and many financial practitioners alike who do not specialize in IRAs. Used appropriately, they may often help individuals and families preserve their retirement wealth. Perhaps they can help you too. Consider researching in more depth on your own, or perhaps broach any of the topics you feel may apply to you in more detail with your financial consultant(s).

What is Escheatment and How Does it Affect Your Retirement Accounts?

How is it determined that an IRA has no owner? This will depend on both state law and the procedures in place at the institution holding your IRA or employer plan assets. If you have an IRA or an old employer plan where you are no longer making contributions, then there are no transactions taking place within the account. This could leave the account open to escheatment.

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Please contact Matt Smith at matt@irahelp.com or (516) 536-8282 with any questions.

 

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