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Subject:  Re: 401K to IRA Date:  1/2/2000  8:26 AM
Author:  Bobbcat Number:  17211 of 105384

Can funds be voluntarily rolled out of a 401K into an IRA?

I know in cases where a minimum bal is not met, a 401K administrator can "require" you to roll your funds out of their plan should one leave the company or their employment be terminated.

If still employed,
the law does not allow a plan to allow you to withdraw 401(k) dollars until you are at least 59 1/2 years old except for hardship or loans.
Loans have never been eligible for rollover.
There are numerous reasons why you don't want to take a hardship.... not eligible to contribute for 12 months, limited contributions upon restarting...
As of 1/1/2000 the 401(k) contribution portion of a hardship withdrawal is not eligible for rollover.

It is plan specific if a plan allows an in-service withdrawal after age 59 1/2. Most will do so only once you reach normal retirement age.

If terminated from employment,
the plan may force a distribution if your vested balance if less than $5,000. When they are ready to pay you, they will send paperwork asking if you want a rollover or a taxable distribution. You have 30 days to return the paperwork before they make a taxable distribution less 20% withholding. You then have 60 days to rollover the 80% check + 20% withholding (from your back pocket) into an IRA to change it to a nontaxable event.


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