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Thread: Rollover of Roth 401k plan funds

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  1. #1
    Join Date
    May 2007
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    Old North State
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    Default Rollover of Roth 401k plan funds

    Client has separated from employer who offered a Roth 401k plan, and current employer has no such plan.

    Employee is in early 50s, and now wishes to move those funds into a "regular" Roth IRA account.

    1 -- From an administrative (paperwork) standpoint, do you think there should be any employer problems related to a DIRECT rollover? (I assume Form 1099-R would show code "H"?) Otherwise I assume there would be a code "B" (or possibly code "J"?) distribution, likely with some tax withholding, and then client would have to be very careful to jump through all of the "rollover" hoops to avoid any tax consequences.

    2 -- Can the funds from the Roth 401k go into an existing Roth IRA account, or must a new Roth IRA account, titled "Rollover Roth 401k Plan" or similar, be necessary ?

    3 -- May I safely assume any rollover funds would not impact the dollar amount of "new" 2017 funds (maximum of $6,500) that otherwise could go into an existing Roth IRA account, after consideration of unknown 2017 AGI amounts?

    Thanks for any insight you can offer. This client seems to come up with something each year to "stump the bartender" so I wanted to see if any TTB members have had experience with this process.

    FE

    NEW: Client just informed me - "stub has Code G"
    Last edited by FEDUKE404; 07-13-2017 at 11:22 PM. Reason: Additional information

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