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Assuming I am eligible to make withdrawals from my qualified plan or 403(b) account, can I rollover the withdrawn amounts to my IRA?

Last Updated December 17, 2015

Question: 

Assuming I am eligible to make withdrawals from my qualified plan or 403(b) account, can I rollover the withdrawn amounts to my IRA?

Answer: 

It depends. First, the receiving IRA must be a Traditional (including a SEP) IRA. These amounts cannot be rolled over to aSIMPLE IRA . And, the amount must be rollover eligible. Rollover eligible amounts usually include all of your account balance, except for the following amounts.

You can rollover the amount withheld for taxes from your other source of funds, if you want to do so; and when you file your tax return, the amount (that was withhled) would be treated as a credit towards any taxes you may owe, or increase your tax refund.

 

Note: Effective January 1, 2008, participants who are eligible to make withdrawal from a qualified plan, 403(b) plan, 403(a) plan or governmental 457(b) plan may rollover the withdrawn amounts to a Roth IRA, providing the amount is rollover eligible. The individual must meet the Roth IRA conversion eligibility requirements, which are:

  • The individual’s (couple if married) MAGI cannot exceed $100,000
  • The individual’s tax filing status cannot be married-filing-separately.

These two restrictions are repealed effective January 1, 2010.

See IRS Publication 575 for more information
  Question answered by by Denise Appleby