Status: 401k

Many people have been asking that status of their 401k plans (besides the fact that the investments themselves have likely tanked due to the problems on Wall Street) and specifically if they need to roll it over to a new firm or if they need to move it from Vanguard to another plan.  Below is what was received via email late yesterday.

Not being an attorney or an expert in 401k administration, here is how I read the second document:

– participants will soon receive a payment from the 401k plan that may be eligible, in whole or in part, to be rolled over to another qualified employer plan (meaning to your new firm’s 401k or similar plan) or to a traditional IRA.  This means you cannot leave your money with Vanguard in the current plan.

– you cannot roll this over to a Roth IRA or various other types of retirement plans that are not eligible to receive such a rollover.

– your new plan is not legally bound to accept rollovers; you need to check first whether your firm’s plan will accept rollovers

– it is best to check with you new plan or traditional IRA as to what documents are required and how rollovers are handled if they are accepted

– there is a summary of tax rules.  I know personally that I don’t want to accept a check made out in my name.  If that happens, I am immediately taxed 20% plus then have to pay a 10% penalty for early withdrawal since I am below the age to qualify for a distribution

– try to have the payment roll directly to the new plan or IRA and never let it touch your hands unless you like the Tax Man

– a rollover cannot be made until after 30 days notice – this email is the notice dated 10/2/2008

– if you have an oustanding loan balance, the balance of your account may be reduced by the amount of the loan still not repaid.  That amount is treated as a distribution and will be taxed (20% federal, state + 10% penalty above) ” . . .unless you roll over an amount equal to the amount of your loan offset to another qualified employer plan or a traditional IRA within 60 days of the date of the offset. “

What I intend to do: talk to my personal financial professional and see if he or she can give me some advice and assist with the rollover of my Heller 401k to a traditional IRA since I may not have a new job within the time required to perform the rollover (60 days).

* * *

As you obtain new employment and roll over your Heller Ehrman 401(k) money into your new employer’s plan, you may be requested to provide proof that the Heller Ehrman 401(k) Plan is a qualified plan. You will want the Plan’s IRS Determination Letter. Here it is:

[attached pdf]

In addition, if you have a loan, you may wish to understand the tax implications of defaulting on your loan when you take a distribution:

[attached pdf]

Both of these documents are posted on the Plan’s 401(k) website here:

http://hewm.vanguard-education.com/ekit/start-forms.html

Save this link. Send it to your home email and save it on your favorites on your home browser.

Advertisements

1 Response to “Status: 401k”


  1. 1 Heller Enron 3 October 2008 at 12:07 pm

    Thanks so much for this info. I wonder if any ex-Brobeckians can weigh in, what with their post-implosion 401(k) issues. We could sure use the foresight of their hindsight!


Comments are currently closed.



Life preserver.jpg
Remember the words of Rev. Frank Scott (Gene Hackman in The Poseidon Adventure):

". . . sitting on our butts is not going to help us either. Maybe by climbing out of here, we can save ourselves. If you've got any sense, you'll come along with us."

Contact Us!

Send us your information as to job leads, networking, or just plain vent!
Go ahead, say it!
Add to Technorati Favorites
Bloggers' Rights at EFF

Credits

This blog has been created by Thomas MacEntee.

Recent Comments

Terms of Service

Heller Highwater (hellerdrone.wordpress.com)
Last Modified: September 14, 2008

- Don't be a dill weed.

- Treat other people the way you want to be treated.

- Ladies and children first.

- This is a rescue, not a bitch session.

- Help don't harm.

- Save the snarks for the attorneys and Above The Law.

Heller Highwater is not:

- a place to practice viscious and vindictive "whisper down the lane" rumour-mongering;

- a place to bad mouth co-workers;

- a place for diatribes against specific people or specific incidents;

- a place to heap pity on poor Heller Ehrman staff by outsiders;

- a place that discriminates or sets margins noting who is outside and who is inside - we even welcome supportive Heller Ehrman attorneys!;

- meant to further the demise of Heller Ehrman, LLP.

Heller Highwater is:

- a place for support, a place of empowerment, a place of passion;

- a place to learn about job leads, resume preparation, skill building, training, new opportunities, and how to succeed in a new workplace;

- a place to keep up on the latest news as to how Heller Ehrman management intends to treat its support staff as it winds down its operations - will it be every woman for herself? or will it be "let me hold the door for you and is there anything else I can do for you"?

- a place of refuge.

Note: in no way, shape or form is Heller Highwater sanctioned, supported or even recognized, (but it is very likely monitored) by the management of Heller Erhman, LLP. The opinions represented here and on each and every page of Heller Highwater do not constitute the opinions of Heller Ehrman, LLP or its shareholders or its management. In addition, the comments left by visitors do not reflect the opinions of Heller Highwater.

%d bloggers like this: