In-Plan Roth Conversion

[Guest A125]

I understand that a participant may only elect an in-plan roth conversion upon a distributable event. How does this apply to money that the employee rolled in to the plan from a former employer's plan? The money is 100% vested and the employee may withdraw it at any time. My thoughts are that it is not eligible for conversion unless the employee experiences a distributable event under the current plan (i.e. distributable event under the former plan was termination of employment but money was rolled into current plan).

Thoughts??

[Lou S.]

If the funds are available for in-service distribution, they are are available for in-plan conversion. At least that's how I understand it.

[Guest A125]

Thanks. I think I found my answer right after I posted. The IRS webpage below confirms that so long as the money is separately accounted for and eligible for distribution it can be converted (provided that it is an eligible rollover distribution).

http://www.irs.gov/retirement/article/0,,id=152956,00.html