Comments on: The Absence of Bill (with Mary Update Bonus!) http://www.sportsgamerblog.com/2006/03/23/the-absence-of-bill-with-mary-update-bonus/ Two guys who love Sports Gaming on their PCs and consoles rant and rave about various stuff. Wed, 07 Jan 2009 17:18:22 +0000 http://wordpress.org/?v=2.6 By: mjb2123 http://www.sportsgamerblog.com/2006/03/23/the-absence-of-bill-with-mary-update-bonus/#comment-2898 mjb2123 Fri, 24 Mar 2006 01:56:00 +0000 http://www.sportsgamerblog.com/2006/03/23/the-absence-of-bill-with-mary-update-bonus/#comment-2898 Dan,<br/><br/>Thanks for the information. After reading your first post, I had a feeling the issue was that I went from a 401K to IRA to Roth IRA. The main thing I knew was that I couldn't go directly from a 401K to Roth IRA. <br/><br/>I made out fine. Just took a hit on taxes this year, but I knew I was going to so that was ok. I figured it was better to pay the taxes on it now than in X years when the amount in the Roth would be greater and so would the taxes. Dan,

Thanks for the information. After reading your first post, I had a feeling the issue was that I went from a 401K to IRA to Roth IRA. The main thing I knew was that I couldn’t go directly from a 401K to Roth IRA.

I made out fine. Just took a hit on taxes this year, but I knew I was going to so that was ok. I figured it was better to pay the taxes on it now than in X years when the amount in the Roth would be greater and so would the taxes.

]]> By: Dan Clarke http://www.sportsgamerblog.com/2006/03/23/the-absence-of-bill-with-mary-update-bonus/#comment-2897 Dan Clarke Fri, 24 Mar 2006 00:49:00 +0000 http://www.sportsgamerblog.com/2006/03/23/the-absence-of-bill-with-mary-update-bonus/#comment-2897 MJB:<br/><br/>This is part of my 'real' job so I'm pretty familar with it.<br/><br/>The situation you discussed is correct. It's different when you are rolling over a 401K -- that's not the same as walking into a financial institution and opening a Roth. The problem with you is that you had a 401K -- you can't transfer that into a Roth without taking a hit. (Basically when you convert, you are going to make all those pre-tax contributions post-tax).<br/><br/>I believe some things are waived for a conversion IRA, honestly I haven't done one in some time, so I'm not totally up to speed on it -- but when you convert you've got to pay the taxes NOW instead of later (you are always going to pay at some time).<br/><br/>You *could* have kept that IRA/401k as is and then opened a 'new' roth and kept them separate. I do know the conversion does have some tax implications...<br/><br/>Hope you made out ok. MJB:

This is part of my ‘real’ job so I’m pretty familar with it.

The situation you discussed is correct. It’s different when you are rolling over a 401K — that’s not the same as walking into a financial institution and opening a Roth. The problem with you is that you had a 401K — you can’t transfer that into a Roth without taking a hit. (Basically when you convert, you are going to make all those pre-tax contributions post-tax).

I believe some things are waived for a conversion IRA, honestly I haven’t done one in some time, so I’m not totally up to speed on it — but when you convert you’ve got to pay the taxes NOW instead of later (you are always going to pay at some time).

You *could* have kept that IRA/401k as is and then opened a ‘new’ roth and kept them separate. I do know the conversion does have some tax implications…

Hope you made out ok.

]]> By: bill http://www.sportsgamerblog.com/2006/03/23/the-absence-of-bill-with-mary-update-bonus/#comment-2896 bill Thu, 23 Mar 2006 22:00:00 +0000 http://www.sportsgamerblog.com/2006/03/23/the-absence-of-bill-with-mary-update-bonus/#comment-2896 My parents opened a Roth straight up..<br/><br/>And yeah, Value City had a spring sale. We didnt go leather so we saved some dough. First time I've been called a cheap bastard since opting for Milwaukee's Best instead of Sam Adams back in the day. I take pride in my cheap beer days. My parents opened a Roth straight up..

And yeah, Value City had a spring sale. We didnt go leather so we saved some dough. First time I’ve been called a cheap bastard since opting for Milwaukee’s Best instead of Sam Adams back in the day. I take pride in my cheap beer days.

]]> By: mjb2123 http://www.sportsgamerblog.com/2006/03/23/the-absence-of-bill-with-mary-update-bonus/#comment-2895 mjb2123 Thu, 23 Mar 2006 21:52:00 +0000 http://www.sportsgamerblog.com/2006/03/23/the-absence-of-bill-with-mary-update-bonus/#comment-2895 Dan - Hmm. I must've misunderstood something. I didn't know you could open a Roth straight up. I guess you'd then pay the taxes that year on the amount you dropped into the Roth IRA? <br/><br/>About a year ago, I left a company for another job and took the money I had in their 401K, transferred it to an IRA and then to a Roth IRA. I guess I got confused because I think the only thing I could do was transfer my 401K to an IRA before I could make it a Roth IRA. I don't think I could go from a 401K to a Roth IRA (or at least that's what I was told). Dan - Hmm. I must’ve misunderstood something. I didn’t know you could open a Roth straight up. I guess you’d then pay the taxes that year on the amount you dropped into the Roth IRA?

About a year ago, I left a company for another job and took the money I had in their 401K, transferred it to an IRA and then to a Roth IRA. I guess I got confused because I think the only thing I could do was transfer my 401K to an IRA before I could make it a Roth IRA. I don’t think I could go from a 401K to a Roth IRA (or at least that’s what I was told).

]]> By: Dan Clarke http://www.sportsgamerblog.com/2006/03/23/the-absence-of-bill-with-mary-update-bonus/#comment-2894 Dan Clarke Thu, 23 Mar 2006 21:17:00 +0000 http://www.sportsgamerblog.com/2006/03/23/the-absence-of-bill-with-mary-update-bonus/#comment-2894 While you can 'convert' a traditional IRA to a Roth, you can also just open a Roth straight up. While you can ‘convert’ a traditional IRA to a Roth, you can also just open a Roth straight up.

]]> By: Lord Flatus http://www.sportsgamerblog.com/2006/03/23/the-absence-of-bill-with-mary-update-bonus/#comment-2893 Lord Flatus Thu, 23 Mar 2006 19:41:00 +0000 http://www.sportsgamerblog.com/2006/03/23/the-absence-of-bill-with-mary-update-bonus/#comment-2893 A thousand dollars for a sofa *and* a dinette???<br/><br/>You, sir, are officially a cheap bastard. :) A thousand dollars for a sofa *and* a dinette???

You, sir, are officially a cheap bastard. :)

]]> By: mjb2123 http://www.sportsgamerblog.com/2006/03/23/the-absence-of-bill-with-mary-update-bonus/#comment-2892 mjb2123 Thu, 23 Mar 2006 19:16:00 +0000 http://www.sportsgamerblog.com/2006/03/23/the-absence-of-bill-with-mary-update-bonus/#comment-2892 FYI - You have to have an IRA before you can have a Roth IRA. So you couldn't just open a Roth.<br/><br/>I had 2 IRA's that I transferred to Roth IRA's this past year. Great thing for a younger guy like myself who can pay the taxes on it now and will never have to again - especially after it gains a lot of money. Of course, it sucked come tax time and owing the government a few thousand. But I'd rather pay it now than in 40 years. FYI - You have to have an IRA before you can have a Roth IRA. So you couldn’t just open a Roth.

I had 2 IRA’s that I transferred to Roth IRA’s this past year. Great thing for a younger guy like myself who can pay the taxes on it now and will never have to again - especially after it gains a lot of money. Of course, it sucked come tax time and owing the government a few thousand. But I’d rather pay it now than in 40 years.

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