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Old 05-13-2016, 09:28 AM   #41
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I rolled over my TSP 401K and TSP Roth to Vanguard accounts even though the TSP had lower fees. I was planning to keep them there until I learned that upon age 70 1/2 they co-mingle both accounts and force RMD's.
The RMD rules apply to the Roth TSP and Roth 401k. If the retirement plan permits, it may be wise to convert any Roth 401k to a Roth IRA to avoid RMD rules.
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Old 05-13-2016, 09:53 AM   #42
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Originally Posted by donheff View Post
It looks like you could have rolled the Roth over and leave the tax deferred with TSP.
Yes, that is good strategy, but I planned to convert more tax deferred to a Roth anyway, while in the window between ages 59 1/2 and FRA (66) or later for SS and still under the 25% bracket.
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Old 05-13-2016, 09:59 AM   #43
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It looks like you could have rolled the Roth over and leave the tax deferred with TSP.
Indeed, that's what I plan to do. My TSP is a Roth, but employer matches are "conventional" so I plan to roll the Roth portion of my TSP over to a Roth IRA sometime before RMDs would be due, I suspect, while keeping the conventional TSP in place (especially if I want continued access to the G fund).
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Old 05-13-2016, 10:46 AM   #44
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Indeed, that's what I plan to do. My TSP is a Roth, but employer matches are "conventional" so I plan to roll the Roth portion of my TSP over to a Roth IRA sometime before RMDs would be due, I suspect.
Keep in mind the Second 5 yr rule for Roth Conversions (link below). It may be good to have an established Roth to convert to. Also on the TSP Roth conversions, start early Nov if you want it to happen in the same calendar year. TSP personnel are swamped in December.

https://www.kitces.com/blog/understa...d-conversions/
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Old 05-13-2016, 10:53 AM   #45
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Keep in mind the Second 5 yr rule for Roth Conversions (link below). It may be good to have an established Roth to convert to. Also on the TSP Roth conversions, start early Nov if you want it to happen in the same calendar year. TSP personnel are swamped in December.
Yep, already have a Roth -- I've had one established at Schwab since 1999.

As for the conversions, I don't turn 70 1/2 until 2036, so I have quite a lot of time to see how things shake out in terms of the law and our financial circumstances. Suffice it to say I wouldn't be waiting until 2036.
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Old 05-13-2016, 12:57 PM   #46
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DW and I both rolled our 401Ks to IRAs at Fidelity. Biggest driver for us was being able to convert significant after-tax contributions to Roth. Happy with service at Fidelity. Expense ratios for Fidelity index funds are comparable with Vanguard.
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Old 05-16-2016, 08:31 AM   #47
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I was going to create a new thread IRA related but saw this so will just add on to the topic plus my question.

When I FIRE'd transfered my w*rk 401K to my personal traditional IRA at Vanguard. I preferred to have the retirement account at one place. Also, I felt it more convenient to sign in to Vanguard and look instead of keep up with any changes the 401K might undergo if left with w*rk.

I've been doing the task of cleaning out my old paper files. About 30 years worth of stuff. My question is for the paper records of the life of an IRA, do I need to retain all the records or just the most recent IRA life? Come RMD time, is the past IRA life important or only the present?

In other words, my very first IRA began about 30 years ago as a CD at the local bank. But since then, got transfered to different custodians (bank to Kemper to Vanguard), then combined with the 401K.
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Old 05-16-2016, 08:37 AM   #48
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I rolled a 457 to SCHWAB IRA bc I was concerned about claw backs & limited options. That was 8 yrs ago and I'm glad I did. Like having them all at 1 place
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Old 05-16-2016, 08:44 AM   #49
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My question is for the paper records of the life of an IRA, do I need to retain all the records or just the most recent IRA life? Come RMD time, is the past IRA life important or only the present?
RMD will be taxable as ordinary income UNLESS part of your contribution was made with after tax dollars. If that's the case, consult with your CPA before shredding anything so that you don't pay tax on more $$s than necessary
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Old 05-16-2016, 08:57 AM   #50
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RMD will be taxable as ordinary income UNLESS part of your contribution was made with after tax dollars. If that's the case, consult with your CPA before shredding anything so that you don't pay tax on more $$s than necessary
Thanks. I remember when my 401K got rolled over to my IRA I was asked what to do with the after tax dollar contributions. I took the money and ran .
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Old 05-16-2016, 08:57 AM   #51
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Generally, the only IRA paperwork I'd keep are the Form 5498 that you receive each year. Also, if you've ever made non-deductible contributions to an IRA, you should have filed a Form 8606 showing what part of the IRA you have already paid taxes on. It is usually filed with your tax return but also can be filed as a stand-alone form.

If you've made non-deductible IRA contributions and did NOT file the 8606, I'd keep all your IRA paperwork and consult with a CPA/EA regarding how you fix the situation ASAP.

It also depends on the state retirement income laws. For example, in PA, if you take early distributions from a retirement plan (1099R, box 7, code 1 or 2), the distribution is taxable to the extent it exceeds your contributions into the plan. Lots of folks are scrambling at tax time reconstructing their contributions.
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Old 05-16-2016, 09:01 AM   #52
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I haven't moved mine yet but I have been thinking about it. My 401k has a number of investment options but nothing compared to my brokerage IRA.

Buying, selling and accessing my 401k money is limited and much, much slower. The good thing about that it keeps the "gambler" tendencies I have in check.
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Old 05-16-2016, 09:12 AM   #53
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One thing I haven't seen mentioned is the case where you have post-tax money in a (tradtional, not Roth) 401k. I recall a discussion on this forum a couple years back where the IRS ruled that the pro-rata rules that apply when converting a TIRA to a Roth IRA don't apply when converting a 401k to an IRA. So if you have $100 in your 401k, where $90 is pre-tax and $10 is post tax, you can move $90 into a pre-tax IRA and $10 into a Roth, with no tax consequences. If the same thing was done from an IRA, 90% of the amount converted to Roth would be taxable, due to the pro rata rules. Maybe somebody who has actually done this can elaborate.

(edit) Google for "IRS notice 2014-54" to see the IRS ruling and a bunch of discussion.
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