I have an ira with a bank for about 2k dollars from a part time job that I no longer work at. they want to know what I want to do with it. I am 73 yrs old. the options are postpone distribution, direct rollover, lump sum cash payment, and partial payment. I also have an ira with vanguard which requires and a yearly withdrawal. the question I have is what is the best way to keep it without a taxable event? or would I have to start taking the yearly rmd from that 401k also?
ira rollover
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njhowie
Thinks s/he gets paid by the post
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IRAs and 401Ks are not the same, but it appears you are using the terms interchangeably.
Assuming the first IRA you refer to is a 401K, the best thing to do is a direct rollover in to the Vanguard IRA. It will not be a taxable event.
Assuming the first IRA you refer to is a 401K, the best thing to do is a direct rollover in to the Vanguard IRA. It will not be a taxable event.
Sunset
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Midpack
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Best answer IMO. DW and I both rolled 401k’s into TIRA’s when we retired.
That said, $2K isn’t a large amount. So if the OP is making withdrawals of $2K or more for spending (doesn’t have 100% SIRE income), at age 73 taking it as income and paying taxes might be easiest.
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38Chevy454
Thinks s/he gets paid by the post
However being OP is 73, there will be RMD on both accounts. So that portion will be taxable.
I do agree just do direct rollover of the 401k into the IRA, that will not be taxable and it simplifies the number of accounts. Also simplifies the RMD. Make sure the RMD for this year covers the amount required for both accounts if you do it after the rollover.
I do agree just do direct rollover of the 401k into the IRA, that will not be taxable and it simplifies the number of accounts. Also simplifies the RMD. Make sure the RMD for this year covers the amount required for both accounts if you do it after the rollover.
Lawrencewendall
Full time employment: Posting here.
My understanding is that the amount in BOTH tIRAs and 401ks are calculated for RMDs. If OP is relying on Vanguard to report RMDs and they don't know about the IRA/401k in the bank, OP would be under withdrawing RMDs. Best to roll everything to Vanguard so they can more accurately report the annual RMD amount. My .02
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