IRA Rollovers

 IRA Rollovers in Maryland, District of Columbia and Virginia

Individual Retirement Accounts 

Comrade Financial Group offers IRA Rollover’s and 401K Rollover services to residents living in Maryland, DC and Virginia.  Rollover IRA or 401k to a product that is the best choice for you.

IRA Rollover in MD, DC and VA

We can roll over Non-Qualified Accounts, Roth IRA’s, SEP IRA’s, TSA/403(b)’s, or Inherited IRA’s. These rollovers will be to a type of Annuity. Click on the  Annuity  page to see more options.

See IRS Rollover Chart to help make your decision

A 401k rollover occurs when you changes jobs or retire and as a result you are entitled to distribute or “rollover” your previous employer’s 401k to an IRA.

It is critical to avoid Negative Tax Implications when performing a 401K Rollover to it is crucial that you understand the rules below:

Take a Cash Distribution

If you elect to receive a cash distribution then the check is made payable to you. Distributions made payable to you are subject to federal and state income taxes. Your employer is required to withhold 20% from your distribution check as a prepayment of estimated taxes. Depending on your tax bracket you may owe more or less than 20% when you complete your tax return. In addition, your distribution is likely to be subject to a 10% pre-mature withdrawal penalty if you are under age 59 ½.

Indirect Rollover

You can elect to take a cash distribution and then deposit the money into your IRA within 60 days. Your employer is still required to withhold 20% for prepayment of federal income taxes. To avoid taxes and penalties, the entire distribution including the 20% withheld for income taxes must be deposited into your IRA. If any amount, including the 20% withholding, is not rolled over within 60 days then that amount will be subject to taxes and possible IRS penalties.

Direct Rollover

With a direct rollover, you authorize your employer to make your check payable directly to the new custodian for the benefit of your IRA. For example, the check would be made payable to the new custodian FBO John Smith. This is sometimes referred to as a trustee-to-trustee transfer and there is no tax withholding, no taxes, and no penalties with this option. Your retirement savings will continue to grow tax-deferred. In most situations, a direct rollover makes the most sense since it avoids potential tax liabilities and penalties.

Non Qualified

A nonqualified annuity is funded with after-tax dollars. The interest earnings are tax deferred until distribution. If the annuity is corporate owned tax deferral does not occur.

Roth IRA

An individual retirement account which permits account holder’s capital to accumulate tax free under certain conditions. Individuals can invest up to $5,500 per year, subject to income limitations. Catch-up provisions of an additional 1000 if over age 50 may apply based upon the client’s age. Withdrawals of principal and earnings are tax free after age 591/2 as long as the assets have remained in the IRA for at least five years after the first contribution.

SEP IRA

A Simplified Employee Pension IRA is an employer-sponsored retirement savings plan that small business owners may offer to their employees. On SEP IRAs a single individual must be named as the owner and annuitant. IRA An IRA is funded with dollars that are tax-deductible from earned income. North American does not accept nondeductible IRA contributions into our IRA policies. In 2011, the maximum contribution allowed is $5,000 unless the contribution represents rollover or direct transfer funds or catch-up provisions. In order for contributions to be accepted for the previous tax year, they must be post-marked no later than April 15th of the current tax year. Distributions from an IRA are 100% taxable income to the owner in the tax year distributed.

TSA/403(b)

 A TSA is a deferred tax arrangement (pre-tax dollars) whereby an employee can exclude from his/her gross income the premium paid on an annuity that will provide a retirement annuity. To qualify for a TSA, an individual must be employed by a nonprofit organization or public school system. All TSA funds must come from a rollover/transfer or from an employer – not directly from the individual.

Inherited IRA

An IRA that becomes the property of someone from the deceased owner of the IRA. Inherited IRAs are subject to special regulations. The IRA can also be paid as an annuity or in periodic installments not extending beyond the beneficiary’s life expectancy (Not available for Non-Qualified funds).

Questions about moving your IRA or 401K to an Annuity?

Question: Can I roll over my savings for retirement like my IRA, 401K, or 403(b) into an Annuity with the burden of paying taxes?

Answer: Yes, you can roll all of those over because they are “Qualified” plans which creates a form of an IRA Annuity. You can also have your employer roll them over because there are no mandatory withholding requirements that pertain to funds directly transferred into an Annuity by your employer.

Question: If I rollover my 401K, IRA, or lump sum pension payment into an Annuity, will I be hit with taxes upon distribution?

Answer: The answer is NO. Pre-tax distributions and pensions can be taxed when withdrawn, but you are allowed to roll over those payments into an Annuity tax-free due to the insurance company setting up an IRA account where the money is transferred. These are known as Direct Rollovers or Direct Transfers therefore taxes will not be charged on the monthly distributions say from an Immediate Annuity.

Question: Are Immediate Annuities eligible for tax-free 401k and IRA rollover?

Answer: The answer is YES as long as you follow the IRS rollover rules. Immediate Annuities will begin to make payments to you usually after 30 days from the date of purchase.

source and resources: IRS.gov