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Question for the Money Doctors

Question submitted on May 7, 2012.

Question

I am over 70.5 years old my husband died and left I 401k plan. I had the 401k plan pull in my name, now I want to roll it over into a IRA, can I do this?

Answer

Yes you can roll the inherited 401k into an IRA and the IRA can be in your name.  Then you will have to take Required Minimum Distributions (RMDs) based on your age.  If you do not need any income from the funds and his former employer allows you to keep the plan there, you may want to consider not rolling over in the event you would like to keep your taxable income lower, or convert any other IRAs you may have to a Roth IRA.  A local CPA/PFS (www.findapfs.com) in your market can help if this type of planning would benefit your situation.


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