What are the tax implications of moving my 401(k) into an IRA?

I want to move my 401(k) into an IRA. Then I want to cash out a portion of those funds. What kind of IRA would allow me to do this? What are the tax implications?

401(k), IRAs, Taxes
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2 weeks ago
50% of people found this answer helpful

You can always rollover your 401k into an IRA as long as the plan permits or you no longer work for the company. Depending on the money in your 401k plan, you can either roll it into a traditional pre-tax IRA or a Roth IRA. Some 401k plans allow contributions to be made with after tax dollars.

Once you roll the money over, you can take a distribution from the IRA. If the money rolled over is pre-tax, you will be taxed based on your income tax rate. If you are under the age of 59 1/2, the IRS may also impose an early withdrawal penalty of 10%. If the money is after-tax dollars, the distribution should be tax free, but the age requirement stille exists. It's best to speak with someone.

If you want more information, just email me at dtimotic@t2asset.com. I'm more than happy to speak with you about your options.

5 days ago