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401k & Retirement Rollovers Explained

401k to Traditional IRA

Rollover from a 401K to a Traditional IRA is a non-taxable event. You can rollover the 401K from your former employer to a Traditional IRA for more options and better control of your retirement portfolio (please contact your financial advisor for investment advice)

401k, 403(b) or Traditional IRA to ROTH IRA

If you want to rollover a 401K, 403(b) or a Traditional IRA to ROTH IRA the rollover amount would be taxable as if it were a regular distribution (however, with a rollover the 10% penalty for early withdrawal will not apply).

If your employer plan or Traditional IRA consists of pre-tax and after-tax money then the amount that you choose to rollover to ROTH will be pro-rated the same way as your total portfolio is distributed between the deductible and the non-deductible parts. You cannot choose to roll over the non-deductible part to avoid tax on the transfer.

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