Originally Posted by mispoken

They do not. Easy way to think of it, if you pay taxes on it now (Anything roth) you won’t have RMDs. If you defer taxes on it now (traditional), you’ll have RMDs because Uncle Sam wants to get his dirty mitts on it eventually, therefore they mandate distributions. No matter what, Uncle Sam will always get his share the goal is to minimize that and thus the back and fourth on traditional vs Roth that pops up on here every few months :-)

Originally Posted by pokin

For clarification purposes:

Traditional 401ks have RMDs.

401A contributions that are then converted to Roth IRAs do not have RMDs.

Do Roth 401k contributions have RMDs?

Thanks

Originally Posted by mispoken

They do not. Easy way to think of it, if you pay taxes on it now (Anything roth) you won’t have RMDs. If you defer taxes on it now (traditional), you’ll have RMDs because Uncle Sam wants to get his dirty mitts on it eventually, therefore they mandate distributions. No matter what, Uncle Sam will always get his share the goal is to minimize that and thus the back and fourth on traditional vs Roth that pops up on here every few months :-)

Originally Posted by pokin

Thanks for the response. I think I'll be changing mine to a roth 401k and have my wife keep hers as a traditional. This is a great topic!!!

Originally Posted by tunes

straight from IRS website:

What types of retirement plans require minimum distributions?
The RMD rules apply to all employer sponsored retirement plans, including
profit-sharing plans, 401(k) plans, 403(b) plans, and 457(b) plans. The RMD rules also apply to traditional IRAs and IRA-based plans such as SEPs, SARSEPs, and SIMPLE IRAs.

The RMD rules also apply to Roth 401(k) accounts. However, the RMD rules do not apply to Roth IRAs while the owner is alive.


https://www.irs.gov/retirement-plans...-distributions

Originally Posted by pokin

Yeah, I did a little more research and agree they do require RMDs but I think the difference is that you can either roll it into a Roth IRA with no tax implications or take the distribution with no tax implications because you have already paid the taxes. Am I way off or does that make sense?

A required minimum distribution that you have to pay taxes on sounds way worse than a required minimum distribution that you don't have to pay taxes on. What am I missing because I'm sure it's something?

Originally Posted by Denny Crane

I can contribute to an traditional ira, I just cannot deduct it. I was thinking more of the 401k. Under the new tax law when using the increased standard deduction instead of itemizing, is it still advantageous to contribute to a traditional 401k? I think it is because that money comes off the top before your AGI is determined whereas a Roth 401k contribution counts towards AGI. Just wanted to make sure I understood it right.

Denny

Originally Posted by mispoken

I can't stress this enough...."Professional Financial Advice" is typically a licensed salesman..

Originally Posted by mispoken

I said this right below the paragraph you took that excerpt from;

“NOW, the actual complicated part of all of this is undoubtedly the tax side. A good fee-only tax advisor is absolutely necessary, in my opinion.”

So we agree there. I don’t think you need a tax attorney to accommplish these Roth money movements. Fidelity has surprisingly knowledgeable and helpful people manning their phones. They won’t steer you wrong in the actual movement of the money. If youre concerned about possible tax implications (such as moving pre tax to post tax), then absolutely, you should seek a tax professionals advice.

Originally Posted by Broncos

- I currently direct Delta's 16% into Fidelity BrokerageLink.
- I also direct 24% individual contribution and 100% of profit share into BrokerageLink. ALL of the individual contributions are AFTER TAX or 401(a).

- Delta's contributions cannot be moved out of the 401k.
- Every two weeks, immediately after I see the after tax money sitting in my BrokerageLink account, I call Fidelity and tell them, "I'd like to transfer all the after tax money into my Roth IRA. (You want to do this right away, because if that after-tax money has a chance to gain earnings, they become taxable, and the earnings cannot be moved into the Roth IRA.)

- From there, it is actually a two-step process. First, it must be moved from the BrokerageLink side to the DPSP side. After that is done, it is moved from the DPSP to the Roth IRA. Fidelity handles both of those steps. It usually takes 2-3 days from my phone call before it is sitting in the Roth IRA. (As a side note, you may be able to get this down to a single step if you direct your money directly into the DPSP, but my process works for me.)

- The best way to think of this (and how it was explained to me), is that you are in a race against Delta. Delta is putting in money every two weeks (based on the number of hours you fly). The TOTAL combined limit is $55,000. The goal is to get to $55,000 as quickly as possible. The quicker you do it, the greater YOUR percentage of $55,000 is, and thus, the greater amount you can get into your Roth IRA each year. Some guys get there in February with Profit Sharing and contributing 75% of their pay.