My husband recently retired from a state institution, and discovered that his state retirement plan earned a whopping 4% interest. Having 30 more years to work in his new field, we wanted to invest aggressively for retirement, and so requested to rollover the entire value of the account to a self-directed IRA. The plan administrator advised that he could only rollover the amount he had contributed (about half of the value) and would have to take the remainder in a monthly pension payment. The administrator did make provisions to pay that miniscule monthly amount directly to the IRA, but no taxes were withheld. Am I correct in assuming that the monthly amount is a distribution, and therefore reported as retirement income? Would there be a better way to handle that monthly amount? The original large rollover amount has almost tripled, so we certainly don't regret moving away from that original plan!
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