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[[I have an esop retirement plan from a previous employer being paid to me in the next few weeks. I
need to take about 30K out of it (to payoff all of my debt!!!) . How will this be taxed? What would
be the best strategy to pay the least amount in taxes (Roth IRA?) ?]]

Without knowing specific information about the plan in question, I can only guess that the $30k that you will be withdrawing and keeping personally will be taxed at your marginal tax rate, plus, if you are under age 59 1/2, you'll most likely pay a 10% penalty on these funds. The remainder of the funds can be "rolled over" into an IRA rollover account, in which case the taxes would be deferred to later years.

For additional inforation on these issues, see IRS Publication 590.

TMF Taxes

SPECIAL NOTE: Remember that this response is not the "last word" on your situation. It is really only a starting point. Make sure to review the "Read This First" post
( for additional information. In addition, many of your questions may already be referenced in the Taxes Frequently Asked Questions area. In order to visit the Taxes FAQ area, go to the Fool's School area ( and check out "Other Features" in the list box, OR you can jump directly to the Taxes FAQ area ( Additionally, if any references were made to the IRS Web Site, you can get there by pointing your web browser to (
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