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When should I use a rollover to my IRA?

That depends on your particular needs and circumstances. Here are some reasons you might want to roll over distributions to your IRA:

  1. You want to, or have to, take a distribution from your employer’s plan and want these funds to continue to grow tax-free in your own IRA.
  2. As a self-employed individual, you are terminating your Keogh plan or retiring from business and want to continue the tax shelter for these distributions.
  3. You are the beneficiary of a deceased person’s retirement plan and want to continue the tax shelter for these distributions in your own IRA.

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Is there a downside to an IRA rollover?

Here are some of the disadvantages of an IRA rollover:

  1. Rollovers from company or Keogh plans may take away your spouse’s right to share in plan assets.
  2. IRAs can’t claim the limited tax relief allowed on lump-sum distributions.

To avoid tax hassles, rollovers should be done between the trustees of the plans involved. In other words, the check should not be made out to you personally, but to the trustee of the rollover account.

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Also See…

Homeowner’s Insurance: How To Get The Best Coverage and ValueCar Insurance: 10 Cost-Cutters To Save You MoneyLife Insurance: How Much and What Kind To BuyDisability Insurance: What To Look ForDisability Benefits: How To Get All You’re Entitled ToLong-Term Care Insurance: How To Get The Best DealAnnuities: How They Work and When You Should Use ThemHow Much Life Insurance Do I Need?The Affordable Care Act

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