No. of Recommendations: 1
Greetings, mdbfool, and welcome. You asked:

<<I know that I can not contribute to both a Roth and a Traditional IRA in the same year. My question is whether I could roll over my 401k into a traditional IRA, each year and not worry about the tax deduction, and still make my $2000 annual roth contributions? IRS Pub 590 seems to read that a rollover from a qualified retirement plan to a traditional ira is not considered a contribution.>>

Actually, you may indeed contribute to both a Roth and a traditional IRA in the same year. You just can't contribute more than a combined total $2K in the same year. Otherwise, you may split that $2K between a Roth and a traditional IRA any way you please.

As to rolling your 401k money into a traditional IRA each year, that's more of a problem. The majority of plans won't let you transfer money out of the 401k until you leave that job. Some, though, do have in-service withdrawals of part (not all) of the money based on your age and years of participation in the plan. Such withdrawals are up to the plan. You must check with your plan administrator to see if yours is one that does allow such transfers.

Print the post  


The Retirement Investing Board
This is the board for all discussions related to Investing for and during retirement. To keep the board relevant and Foolish to everyone, please avoid making any posts pertaining to political partisanship. Fool on and Retire on!
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.