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Author: Joekay Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75793  
Subject: gov't "thrift acct" aka 401k for feds Date: 4/24/2000 10:06 PM
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Can you take your thrift acct funds (tax deferred)and put them into a Roth IRA (after tax funds) upon retirement? Where does the tax come in?
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Author: Mark0Young Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 21495 of 75793
Subject: Re: gov't Date: 4/24/2000 10:48 PM
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Can you take your thrift acct funds (tax deferred)and put them into a Roth IRA (after tax funds) upon retirement? Where does the tax come in?

I don't know if you can but, if you can, the process is actually 2 steps (though many brokerage and fund families can do both steps so they look like 1 step to you, but it is 2 steps to the IRS).

1. If you can do it, you can contact the fund family or brokerage that will act as the custodian to the "Rollover IRA". Fill out the paperwork to have money transerred from your "thrift account" to an IRA (the "Rollover IRA") at that brokerage or fund family. Do not take posession of the money yourself! Instead, have the organization that will have the IRA account request a "custodian to custodian" transfer.

2. Once the money is in an IRA, it can be converted to a Roth IRA, either entirely or in part. The year money in an IRA is converted to Roth IRA is the tax year for which you pay taxes on that money. You will be taxed at ordinary income tax rates.

First, check if you can have the money transferred to an IRA custodian. There might be fees or even a plan prohibition.

Secondly, you may want to double-check whether or not you are within the adjusted gross income limits for an IRA conversion to a Roth.


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Author: TMFExRO Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 21500 of 75793
Subject: Re: gov't "thrift acct" aka 401k for f Date: 4/25/2000 1:32 AM
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<< Can you take your thrift acct funds (tax deferred)and put them into a Roth IRA (after tax funds) upon retirement? Where does the tax come in? >>

Yes, you can roll your TSP account into an IRA after you retire. You've already been given the answer about how you do this and the tax treatment. The AGI limit for converting from traditional to Roth IRA is $100,000 unless you file married, filing separately, in which case you cannot convert.

TMF ExRO
Phil Marti

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