Appleby

No

Also a FAQ from the IRS' website:

Yes. Because your distribution will be qualified, any amount you withdraw will be tax and penalty-free. Qualified distribution defined here http://www.retirementdictionary.com/qualif...bution-roth.htm

True. Unless the plan is established and maintained under the US tax Code and is an eligible retirement plan, it cannot be rolled over to a US plan. Eligible retirement plan- for rollover purposes, is defined under 402(8)(b) Edited to change 402(8)(b) to 402©(8)(B). Thanks jevd.

But because Yesnam will be at least age 59 ½, the 10 % penalty will not apply. A good way to look at it is: Would the 10% penalty apply if the amount was withdrawn from the traditional IRA? If the answer is no, then it does not apply to the Roth IRA. If the answer is yes, then we would need to look at how much the convert amount has aged. Since you are at least age 59 ½, and your first Roth IRA was established more than five years ago, all your Roth IRA distributions will be qualified and therefore tax and penalty-free.

The CIP rules must also be considered. While they are waived for IRAs established to receive automatic rollovers, I am not aware that they would be waived in such a case. Maybe someone else who handles the compliance aspects of new accounts can address that ?

Bird, I think it’s different for participants for reasons which include: ----There is guidance that says if the participant is unable to ( or refuses to ) sign the paperwork, the employer may do so on the participant’s behalf ----Contributions for the participant may be necessary so as not to disqualify contributions for other participants.

Try Google

It can be done for a SEP. I have never seen a SIMPLE document that allows such, but it may be possible with a prototype or individually designed SIMPLE

Interesting decision on the subject at http://splitcircuits.blogspot.com/2008/06/...g-circuits.html

M, I am curious ...where have you found SIMPLE 401(k)s? I have checked with almost every major (and some non-major) financial institutions, and it seems no one if offering them.

If you are using your computer at work, it is possible they have changed their settings for security reasons. Some firms are enhancing security measures to protect employees information by automatically deleting the ‘remember me’ option. It helps to protect financial information and assets. Rhetorical question that may help to provide you with an answer… Do you use any other service for which you store user information? and if so, do you have the same issue with those?

A SEP is not a ‘qualified plan’. But it is an ‘eligible retirement plan’ for purposes of rollovers ( receiving and delivering).

I'm w/ Janet. Don't even let them go down any path that results in taxation (even if paid by the brokerage). If Jim's not talking to the branch manager at this point, then he needs to move up the ladder. Ditto! You just need to talk to the right people and say the right things. They must fix it if the client did not make the mistake. Start by obtaining copies of all the paperwork that was signed for the transaction. In this case, they may still need to fix the error even if the client signed the wrong paperwork (Roth to TIRA)- as they should know better than to allow a transfer between a RIRA and a TIRA.

I agree too. 59 ½ is the retirement age under the plan right? No smacking around ( this time)

I use it often, and I can vouch for it's accuracy

The IRA custodian should not process transactions based on instructions from anyone, other than the IRA owner. It is true some do honor such requests, but they should not. The notification should be sent to the IRA owner, and the IRA owner should take the return-of-excess path to correct the ineligible rollover.

It seems the TPA is right, primarily because of the first paragraph in the CJA’s post. The participants now need to remove the amounts from the IRAs as return of excess contributions.

Hi Janet, 2008-30 Q&A 6 says in part "a distributee and a plan administrator or payor are permitted to enter into a voluntary withholding agreement with respect to an eligible rollover distribution that is directly rolled over from an eligible retirement plan to a Roth IRA." I am not sure if you are saying you do not want to, or think you cannot... Denise

I could be wrong, but I don’t think it can be returned to the plan. Even though the check was not cashed, don’t you have constructive receipt occurring?

Yes. When you calculate the earnings on an excess contribution, the earnings is based on the performance of the entire IRA for computation period, which is the period beginning immediately prior to the time that the contribution being returned was made to the IRA and ending immediately prior to the removal of the contribution. Only after you have figured out the earnings will you know how much to remove, i.e. the excess amount ( plus earnings or minus losses). You may also find this helpful http://www.irs.gov/pub/irs-regs/td9056.pdf. The amount removed need not be the asset in which the contribution was invested. The only requirement is that the amount removed is equal to the value of the excess plus earnings or minus losses Edited to add...While the asset in which the contribution was invested may have done well, there could still be a ‘loss’ on the contribution if all the other assets performed so poorly that it results in a 'loss' for the IRA during the computation period (computation period is defined in the document at the link above).

You could consider recharacterizing the contribution to a traditional IRA. Depending your active participant status and ( if you are an active participant or married to an active participant), your MAGI, you may be able to deduct the contribution. If you are not eligible to deduct the contribution, you could still treat it as a nondeductible contribution to the traditional IRA.

I agree with Bird. You want to drop the ‘partial’, as it may only confuse those involved. The participant can submit a withdrawal request for the total balance, and include instructions to : a) Send the pre-tax amount to the new employer-plan b) Send him a check for the after-tax amount. This will provide the desired results.

YW

I don’t have those notes now, but I recall researching this in detail in order to respond to an attorney who challenged us on our position ( I worked with a brokerage clearing firm/custodian at the time). He felt the agreement was sufficient. In the end, he agreed with us that without a legal separation agreement or divorce decree signed by a judge, it would be a distribution to the IRA owner giving up the assets. If the recipient spouse credited the amount to her IRA, it would be treated as a regular IRA contribution, subject to the contribution limit in effect for the year.