tag:blogger.com,1999:blog-6318055043707993918.post8852597957253746033..comments2024-02-20T02:12:18.090-05:00Comments on THE WANDERING TAX PRO: THE ROTH 401(k) DILEMMARobert D Flachhttp://www.blogger.com/profile/06034127763662917220noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-6318055043707993918.post-61860916724016021232007-01-27T08:05:00.000-05:002007-01-27T08:05:00.000-05:00Mcgffey:
Glad you enjoy the blog!
Sorry for the ...Mcgffey:<br /><br />Glad you enjoy the blog!<br /><br />Sorry for the delay in responding. As the tax filing season is fast approaching I have been very busy getting ready for the deluge that will begin on February 1st.<br /><br />I do not provide financial advice, to clients or readers. The most I can do is to explain the tax consequences of the various options available in a given situation.<br /><br />As it is almost tax time I really do not have the time to provide you with a detailed analysis of the various options available to you. <br /><br />My quick response is that you might consider rolling the $10,000.00 in the old 403(b) into a traditional IRA. This can be done tax free. As you are planning to purchase a personal residence in the near future, you will be able to withdraw up to $10,000 from an IRA to purchase a home without having to pay the 10% premature withdrawal penalty. The withdrawal will be subject to regular federal and state income tax, but if the home is purchased early enough in the year the deductions for mortgage interest and real estate taxes (and possibly points) should help to reduce the additional tax on the withdrawal.<br /><br />You will not be able to rollover monies from a 403(b) directly to a ROTH IRA until tax year 2008.<br /><br />Perhaps after the tax season is over I will post a discussion of the differences in the various retirement savings options.<br /><br />I hope I have been of some help. <br /><br />RDF<br />The Wandering Tax ProRobert D Flachhttps://www.blogger.com/profile/06034127763662917220noreply@blogger.comtag:blogger.com,1999:blog-6318055043707993918.post-26136635603019561732007-01-16T13:00:00.000-05:002007-01-16T13:00:00.000-05:00Nice informative post. Thanks!
I have a question ...Nice informative post. Thanks!<br /><br />I have a question for you - I'm about 30, making $40K a year in non-profit work. I'm engaged and I don't own a house, but I'm saving for a down payment. I have almost $10K in an old 403(b) from a previous job, and about 10K in student loans (and rising, since I'm a part time student)<br /><br />My employer doesn't offer the ROTH 401(k), just a regular 403(c). My employer doesn't have a match - they just deposit an amount equal to 3% of my salary whether I make contributions or not. <br /><br />I have begun depositing about 10% of each paycheck into the current 403(c), but I'm wondering what I should do with my old 403(c) account. Should I roll it into a ROTH IRA? A traditional IRA? Should I max out an IRA, and then add whatever's left over to the 403(c)? I've read about the various accounts, but I haven't really understood their subtleties and which would be more appropriate for my situation. <br /><br />I'm wondering how to maximize the return on my savings so I'll be in the best position for retirement. Since I work mainly in the non-profit world, my salary will probably never be too high, so I really need to save effectively. <br /><br />Any advice on what to do with my old 403(c) and current retirement contributions? Thanks! Love your site!Anonymousnoreply@blogger.com