Rental Property Investor · West Palm Beach, FL · Member since 2016 · 13 posts · 5 votes
I understand the concept but I would like to know if a 403B is ineligible for rollover if you are currently employed with the company that administers the investment. I stumped a Tax Attorney and the tax attorney gave me a general response that left me unsatisfied. Would Bigger Pockets universe give me advice? I really appreciate it.
Hi - thanks for your question. So long as you are over 591/2 you should be able to rollover the 403B funds to another 401(k) to do a ROBS. You will need to check with your plan administrator to confirm the 403B plan triggering event rules for your specific plan. Hope this helps.
Hi - thanks for your question. So long as you are over 591/2 you should be able to rollover the 403B funds to another 401(k) to do a ROBS. You will need to check with your plan administrator to confirm the 403B plan triggering event rules for your specific plan. Hope this helps.
A 403(b) with a current employer is unlikely to be able to be rolled over. Ask your 403(b) administrator if you are eligible for an "in-service distribution". If you are over age 59 1/2, the answer will be yes, as that threshold is required by law. Similarly, if any of the funds in the 403(b) were rolled in from a prior plan. Some plans do offer more generous in-service terms such as a younger age threshold or certain number of years of service.
If you can roll out of the current plan, 403(b) funds are eligible to roll into a ROBS qualified plan.
1) If you can rollover the funds there are no taxes or penalties (that is one of the main features of the ROBS 401k Business Financing plan that is attractive);
2) Just keep it simple - ask the administrator if you can rollover funds to an IRA and if so, how much. If you can rollover funds to an IRA then you can rollover the funds to a ROBS 401k and there are no taxes/penalties. You will want to work with an experienced ROBS provider that will handle the transfer since the 403b will need to report the transfer to the IRS and you want to be sure that they report the transfer as a non-taxable direct rollover.