Is it true I can only transfer to a traditional IRA as oppose to a Roth IRA?
I was told only taxed money can go into a Roth IRA.
1.Initiate a 401k transfer as you reach a benefit event during your
professional life. The Internal Revenue Service defines a benefit event
as retirement, new employment or achieving the age of 59 years and 6
months old. You must pass this threshold to consider transferring money
to your IRA.
2.Fill out a 401k election form in order to move funds to your
individual retirement account. This form allows you to inform your
employer about the next destination and amount of money to be
transferred from your 401k funds.
3.Review your IRA trustee's limitations on transfers from a 401k
account. These limitations may include a ceiling for the contribution
amount you can make in a year. Other accounts feature longer transfer
periods to ensure that all fund movement is legitimate and completed
4.Utilize the direct transfer option to move your 401k funds to an IRA
without taxes or penalties. This option allows you to move money from
one trustee to another without the funds reaching your hands.
5.Move quickly to deposit 401k funds to your IRA if you received a check
for the total withdrawal amount. The IRS and your old 401k manager
require you to deposit withdrawn funds within 2 months to avoid
taxation. Failure to deposit funds will result in a 10-percent penalty
and income taxes levied against the principal.
6.Complete an application with your new IRA provider before you make any
movement on your 401k account. You should make an initial deposit in
your IRA to ensure the depositing system is working properly.