Rollover of 403b to Traditional IRA

April 19th, 2007

Should I make a rollover of 403b to Traditional IRA?

A rollover of 403b to Traditional IRA is permitted if one of the following Rollover of 403b to IRA permissible events occur:

death,
disability,
over 59 1/2 or
separation from service.

From 2002, if a 403b retirement plans are permitted for a rollover of 403b to traditional IRA, the 403b plan owner can transfer 403b to IRA, to another employer retirement qualified plan, such as a 401k, or deferred compensation section 457 plan, if the targeted retirement plan allows it.

If a rollover of 403b to Traditional IRA is permitted, the 403b plan is treated the same way as 401k rollovers from other qualified plans.

Can and should a rollover of 403b to Traditional IRA be commingled with IRA contribution assets?

Although 403b plans assets may be commingled with other IRA assets, and IRS rules allow IRA contribution money to be rolled into a 403b plan, 403b plans are not obligated to accept rollovers of IRA contribution money or even 403b retirement plans money.

The 403b plans document determines whether the 403b plans will accept an IRA Rollover of 403b retirement plans or IRA contribution money.

An employee might want to roll the 403b plans assets back into another 403b plan to be in a position to have the ability to take loans from the 403b plans or have enhanced creditor protection that some states afford to 403b plans. See also more frequently asked questions about Rollover of 403b and whether you should rollover your 403b plan.

Rollover IRA