457b rollover to a roth

[Slim11]

Ok , people smarter then me. Is this 1) possable, 2 smart. I know taxes will have to get payed. To whome and what percentage? I am ok with figures but not so much on what is feasible or good. So, say I have 400k in a 457b, plan to retire, so I have acess to all or part of it immediately. I dont plan on touching it for 10 to 15 years. So i will be 60 in 10 years. Addtionally, do you think they will still give me a guaranteed rate, right now its in a 4 percent general account. Slow and steady for me in this area. Is a roth worth it? Estimated income without this account will be aprox 100k a year. Thoughts, questions, advice? Any ideas welcome.

 

[Out-to-Lunch]

Ok , people smarter then me. Is this 1) possable, 2 smart. I know taxes will have to get payed. To whome and what percentage? I am ok with figures but not so much on what is feasible or good. So, say I have 400k in a 457b, plan to retire, so I have acess to all or part of it immediately. I dont plan on touching it for 10 to 15 years. So i will be 60 in 10 years. Addtionally, do you think they will still give me a guaranteed rate, right now its in a 4 percent general account. Slow and steady for me in this area. Is a roth worth it? Estimated income without this account will be aprox 100k a year. Thoughts, questions, advice? Any ideas welcome.

Yes, it is possible to rollover and convert money from a pre-tax 457(b) account to a Roth IRA: https://www.irs.gov/pub/irs-tege/rollover_chart.pdf

The criteria for whether Roth conversions are advisable center around whether the tax rate for the conversion is greater or less than the effective marginal tax rate when you would withdraw the money from the 457(b) later. And I say "effective" rate, because there are many complicating effects other than simply your tax bracket, such as IRMAA, NIIT, ACA subsidies, filing MFJ vs. single, etc.

But, offhand, it is very unlikely to be worth it to convert a large lump sum in one year. It is generally best to "levelize" your income over time, so that you have a similar amount of taxable income each year.

 

[Slim11]

Got it. Was just seeing if I was missing anything. But thats kinda the plan, let it grow for a bit and then start taking the intrest at say 65, then a little more each year if I need to.