Conduit IRA

[Guest cascigm]

Individual rolled 401k account into existing IRA and now would like to roll it back into a 401k plan.

Am I correct that he is now unable to do this based on the above?

[Guest GregSelf]

See Sect. 408(d)(3)(A)(ii) & Let. Rul. 8433078 If the existing IRA already had funds in it, you're correct.

[Kathy]

Is it possible that the existing IRA only contained rollover money from a previous employer's qualified plan? If that's the case, I think you can still consider it a conduit IRA and roll the whole thing back into another qualified plan.

[Guest GregSelf]

Kathy:

Good point. PLR 9604028: "...The Service has ruled that a pension distribution commingled in the participant's IRA with assets not coming from a qualified plan may not be rolled over to another qualified plan." Seems to indicate you can still roll it back into a 401(k) plan as long as there aren't any non-qualified funds in the IRA. Still, I'd put it in a separate account to avoid the hassle.