The money in your profit-sharing account will be taxable when it is withdrawn from the account. You may leave the money in the plan (if the plan allows it) or roll over the balance to an IRA.

Most financial planners would recommend that you do not leave the funds in the profit-sharing plan after you leave the firm, as you run the risk of losing track of the funds. (To learn more, see Keeping Track Of Your Assets and Moving Your Plan Assets?.) Furthermore, IRAs usually allow more estate-planning flexibility than qualified plans (such as the profit-sharing plan).

This question was answered by Denise Appleby
(Contact Denise)

  1. I have a profit-sharing plan with my former employer. I am now trying to buy a home. ...

    Profit-sharing plans are retirement plans with companies that give employees a percentage of the company's earnings. A profit-sharing ... Read Answer >>
  2. Can I roll the funds in an SEP-IRA over to a profit-sharing plan or self-directed ...

    Yes. Funds can be rolled over from an SEP IRA to a profit-sharing plan, provided the plan document that governs the profit-sharing ... Read Answer >>
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  1. Profit-Sharing Plan

    A plan that gives employees a share in the profits of the company. ...
  2. Qualified Trust

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