If you're no longer working for that employer, you can roll your 401K over into a Roth IRA. You don't py any penalty, but you d have to pay income tax on the amount rolled over, the year you roll it over into a Roth.,
No. All withdrawals made from a tax-deferred 401k are taxable. Doing it just before 65 makes no sense. That's not to say it shouldn't be done at all. The earlier in life you do it, the longer you have to recover from the tax hit, which can't be avoided, and the longer that converted money will grow tax-free.
Some employers are offering 401k to 401k Roth conversions, known as in-plan conversions. More employers are offering these. Read this Forbes article:
http://www.forbes.com/sites/ashleaebelin...
Conversions from a traditional plan to a Roth are taxed when the conversion is made, so making that conversion in your likely-highest-paying year(s) would be at a tax disadvantage.
You CANNOT "avoid paying the IRS" Income taxes on your 401(k) balance unless you DIE, and your beneficiary "rolls over" the balance into their own Plan...
That's the only way to do it...
Nope
Nope - the amount transferred would be taxed at your current income tax rate.
Is it possible to transfer the savings inside your 401K into your Roth IRA just before you hit 65 (that way you avoid paying the govt on some of your 401K earnings)?
