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Author: TMFPMarti Big funky green star, 20000 posts Home Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121482  
Subject: Re: Moved 401k to rollover ira but... Date: 10/31/2012 3:34 PM
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I recently moved my company sponsored 401k into a rollover ira (I left the company). Somehow, out of the roughly 100k, about 2k of the money was already taxed and didn't qualify to go into the ira. Instead, Fidelity put that into a cash account.

I think this occurred ...


Here's my guess how. Someone--I mention no names and make no charges--didn't pay close attention to plan statements and separation instructions about options for this money. But anyway,

So my question is, can I actually withdraw this money without the worries of paying additional taxes or a penalty (assuming it doesn't change my tax bracket)?

If it hasn't been 60 days since the check was cut to Fidelity you can still roll that money into your traditional IRA. You'd then track the after-tax part on Form 8606, Part I. Just mentioning this because up until now it was retirement money, so it's not really found money.

OTOH, it's already been taxed, so it won't be taxed again, and there's no penalty. Bon voyage!

Phil
Rule Your Retirement Home Fool
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