Ensure Employees Are Up To-to-Date on New Roth IRA Conversion Rules and New opportunities to Save for Retirement

November 18, 2009
Recently, an article in the October issue of ACCESS: TIAA-CREF offered insights on the significance of the new Roth IRA conversion rules to your employees. Starting January 1, 2010, a new law eliminates the rule that prevents taxpayers with a modified adjusted gross income above $100,000 from being eligible to do a Roth conversion, which involves converting or rolling over an existing Traditional IRA and/or an eligible distribution from a tax-qualified plan (e.g., 403(b), 401(k) or 457) into a Roth IRA. In addition, for conversions in 2010 only, individuals can pay the applicable taxes in 2010 or split the payments between 2011 and 2012.

With income and filing status requirements removed, as of the coming year, and unique tax options available for 2010 conversions, it’s important that your employees fully understand the new conversion rules to determine if they can take advantage of them in their retirement planning.

TIAA-CREF has compiled a host of materials that detail the new rules. Since effective education can be a significant factor in helping employees achieve a comfortable retirement, it’s important to share these materials with your employees:

• Roth IRA Q&A (PDF)
• Roth Conversion Analysis (PDF)
• New Roth Conversion Opportunities: Is Converting a Traditional IRA, 403(b) or 401(k) a Smart Move, Unwise or Much Ado About Nothing? (PDF) — A recent article in the September 2009 issue of Trends & Issues on the TIAA-CREF Institute’s Website

Your employees can contact one of our experienced, noncommissioned* consultants at 800 842-2776 to learn more about potential tax opportunities of converting to a Roth IRA.