Roth IRA question

[inspectah]

I changed jobs and am rolling over my old 401(k), which has a designated Roth component. About 70 percent of the balance is in the Roth portion. My new employer will not allow after-tax transfers, which sucks. Apparently I now have to split the old 401(k) balance in two.

Is there no way to get the two portions back in the same pool without a tax penalty, e.g., maybe an indirect transfer of the Roth portion to my new 401(k)? I like to keep things simple and I hate the thought of having to monitor two accounts. Should I just put the Roth portion into a stand-alone IRA? I'm at a point where the Roth is probably not best for me anyway as I anticipate being in a lower tax bracket at retirement than I am now.

Any advice?

 

[deacphan]

i dont think youll pay taxes on a roth if you draw it down in retirement. not on the contributions or the gains.

as far as rolling it int o anything, i have no idea, but you could probably just roll it in to a roth with whoever your company uses to manage the 401k. how much work do you really do to manage either? i pretty much set it and forget it, and then every once in a while take stock of my allocations to the different funds.

 

[ITK]

http://www.goodfinancialcents.com/can-you-roth-ira-rollover-rules-from-401k/
http://www.kiplinger.com/article/re...ou-can-roll-over-a-401-k-into-a-roth-ira.html

 

[inspectah]

http://www.goodfinancialcents.com/can-you-roth-ira-rollover-rules-from-401k/
http://www.kiplinger.com/article/re...ou-can-roll-over-a-401-k-into-a-roth-ira.html

Thanks. Those don't quite address my scenario but are helpful nonetheless.

 

[bojanglefunk]

i dont think youll pay taxes on a roth if you draw it down in retirement. not on the contributions or the gains.

.

His point was a Roth doesnt make sense now because he is paying a higher tax rate by putting after tax money in now than if he put in pre-tax in a regular IRA and paid the lower bracket later.

 

[deacphan]

oh well if it's already in a roth he's already paid taxes on it. that's what i was referring to. i guess i misunderstood.

 

[bojanglefunk]

oh well if it's already in a roth he's already paid taxes on it. that's what i was referring to. i guess i misunderstood.

Gotcha. I read it as him not wanting to put money in a Roth going forward.

 

[inspectah]

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