Moving Retirement Funds to a Different Type of Retirement Account
Can you move retirement funds from one account type to another? The answer is YES! In fact, many people do this every year. Moving funds from one retirement account to a different type of retirement account occurs when you leaving employment and need to move the funds from the company custodial account. You might be moving funds when you become self-employed and open your own company-sponsored retirement plan. When you want your retirement savings to grow tax-free, you move funds through a conversion of pre-tax retirement assets and funds.
Types of Retirement Accounts:
- Traditional IRAs can be moved to Traditional IRA, a Simple IRA*, a SEP IRA or a 401k, 403 b, 457 b or Pension plan.
- Roth IRAs can only be moved to another Roth IRA.
- Simple IRAs can be moved to Traditional IRA, a Simple IRA*, a SEP IRA or a 401k, 403 b, 457 b or Pension plan.
- SEP IRAs can be moved to Traditional IRA, a Simple IRA*, a SEP IRA or a 401k, 403 b, 457 b or Pension plan.
- Inherited IRAs can only be moved to another Inherited IRA. The only exception is a spouse has the choice of moving to their own retirement account or an Inherited account.
- 401ks, Solo 401ks, 403 b, 457 b, Pension plans or TSA plans can be moved to a Traditional IRA, a Simple IRA*, a SEP IRA or a 401k, 403 b, 457 b or Pension plan.
If the 401k, 403 b, 457 b, Pension plan or TSA plan is holding both pre-tax and after-tax funds, the pre-tax funds would need to be moved to another pre-tax account. The after-tax funds would need to be moved to an after-tax account.
uDirect offers Traditional, Roth, Simple, SEP and Inherited IRAs. We also offer the Solo 401k. Each of these accounts would a Self-Directed account with us.
*The Simple IRA must be opened over 2 years before it can accept or send funds from a different retirement plan. Some Simple plans are created where you can only use the custodian the employer picked. It can also be created where you are allowed to pick the custodian.
uDirect Blog articles discussing different types of accounts:
Read about the Solo 401k HERE
Read about a SEP vs a Solo k HERE
Read about a SEP IRA HERE
Read about a Simple IRA HERE
Read about the differences between a Roth and a Traditional IRA HERE
Read about Inherited IRAs HERE
uDirect IRA Services, LLC is not a fiduciary and does not render tax, legal, accounting, investment, or other professional advice. If tax, legal, accounting, investment, or other similar expert assistance is required, the services of a competent professional should be sought.
Consulting a tax or legal professional regarding a decision about a retirement account is a very good idea. Contact us if you have questions about this or any Self-Directed IRA related topic. You can reach us at (866) 706-2798 or info@uDirectIRA.com. Get started today by completing an online application HERE.
No information in this article should be considered financial, tax, or legal advice and may not be relied upon as such.