Table of Contents

• When shall I use a rollover to my IRA?
• Is there a downside to an IRA rollover?

When shall I use a rollover to my IRA?

That depends on your particular needs and circumstances. Here are some reasons you might want to roll over distributions to your IRA:

1. You want to, or have to, take a distribution from your employer’s plan and want these funds to continue to grow tax-free in your own IRA.

2. As a self-employed, you are terminating your Keogh plan or retiring from business and want to continue the tax shelter for these distributions.

3. You are the beneficiary of a deceased person's retirement plan and want to continue the tax shelter for these distributions in your own IRA.

Is there a downside to an IRA rollover?

Here are some of the disadvantages of an IRA rollover:

1. Rollovers from company or Keogh plans may take away your spouse’s right to share in plan assets.

2. IRAs can’t claim the limited tax relief allowed on lump-sum distributions.

Tip:To avoid tax hassles, rollovers should be done between the trustees of the plans involved, and not as a do-it-yourself.