Can I reverse rollover mistake?

[Guest sojourner43]

Last week, a retired municipal 457 plan employee, age 54, rolled over his 457 plan balance into an IRA...thus becoming subject to the pre age 59 1/2 early withdrawal penalty.

Can this be reversed? Or fixed in any way?

Thanx,

James Jackson

[joel]

Last week, a retired municipal 457 plan employee, age 54, rolled over his 457 plan balance into an IRA...thus becoming subject to the pre age 59 1/2 early withdrawal penalty.

Can this be reversed? Or fixed in any way?

Thanx,

James Jackson

A pre-age 59.5 rollover is not subject to the early withdrawal penalty. A rollover is a tax-free transaction regardless of age.

There is no need to reverse this transaction.

Peace,

Joel

[Guest sojourner43]

Joel,

Let me be a little more clear.

When the retiree rolled their 457 money into the IRA, they "lost" the ability to access the money "early withdrawal penalty free" because the 457 plan does not have a pre-age 59 1/2 10% penalty...the IRA does.

As a matter of fact, the new custodian has not received the transfer as of this morning, however, the check has been cut and mailed by the previous custodian.

Can this transaction be stopped as to preserve the retiree's pre- age 59 1/2 access.

Thanx,

James Jackson

[joel]

Why not have the new custodian simply return the check instead of depositing it. It seems that should do it.

Peace,

Joel