By Mike Miles
January 21st, 2013 | Uncategorized
Q. I am a 64-year-old CSRS employee. If I transfer some of my Thrift Savings Plan into an IRA with a private company, does it need to go into a traditional IRA, or can it be transferred into a Roth IRA?
A. It can go into either, but check with a CPA before proceeding.
Al R Says:
February 6th, 2013 at 2:31 am
If you transfer some of your TSP money into a Roth IRA you will be hit with taxes. It may not be a good idea to do that unless you are in a very low tax bracket and have a very good reason for preferring a Roth IRA over a traditional IRA. If the ‘private company’ is offering low cost (expense ratio) index funds similar to the TSP, it may be a good idea but if said company is pushing managed mutual funds and or with high expense ratios and loads (A, B, C shares) then you’re in trouble.