Open Access. Powered by Scholars. Published by Universities.®
Articles 1 - 1 of 1
Full-Text Articles in Business
401-K Payout: Lump Sum Distribution Or Ira Rollover, G. Richard Deved, Robert W. Phillips
401-K Payout: Lump Sum Distribution Or Ira Rollover, G. Richard Deved, Robert W. Phillips
Robins School of Business White Paper Series, 1980-2022
Significant sums of money are being accumulated on a taxed deferred basis in 401-K retirement accounts. Those individuals with large amounts of money in these thrift accounts generally must decide whether to take a lump sum distribution upon retirement and pay taxes on a five year or ten year averaging basis or roll the distribution over into an Individual Retirement Account (IRA). A person born before January 1, 1936 can choose between five year and ten year averaging methods; while a person born later cannot use the ten year average method. Five year or ten year averaging can only be …