By Sarah Brenner, JD
Director of Retirement Education
QUESTION:
Hi,
I was wondering if my Roth account that is a part of my Thrift Savings Plan (TSP) through federal employment counts toward my five-year rule for a Roth IRA? If I wanted to transfer the money from my workplace Roth account to a Roth IRA outside of my employment. Does the clock for the five-year rule start with my workplace Roth or with the Roth IRA I open separately?
Thank you!
Judy
ANSWER:
Hi Judy,
This is a good question and one we hear frequently. When it comes to tax-free distributions of qualified earnings, the Roth IRA will have its own five-year holding period. You do not get credit for the time the Roth plan account has been open. Instead, the clock for tax-free earnings starts with your first contribution or conversion to a Roth IRA. If you are looking to roll over the funds from your TSP to a Roth IRA, you may benefit by getting a jump-start on the five-year clock by doing a conversion or Roth IRA contribution as soon as you can.
QUESTION:
Hello!
I reached age 73 on February 9, 2026. I am still working and have a current 401(k) account. I don’t intend to retire, but plan to work for a couple of years, until I reach age 75.
I have a traditional IRA account. To avoid taking required minimum distributions (RMDs) from the IRA account, I am considering rolling over that account to my 401(k) account. Please let me know if I can do it and avoid RMDs. If that is fine, what is the deadline for the rollover from IRA to 401(k) plan?
Jay
ANSWER:
Hi Jay,
The rules do allow rollovers of pre-tax funds to employer plans. The rules also allow a delay for RMDs on funds in an employer plan if the “still-working” exception is available. There is no deadline for doing this rollover. However, because you reach age 73 in 2026, you must take your RMD for 2026 from your IRA prior to the rollover. The RMD is not eligible for rollover to the plan.
If you have technical questions you would like to have answered, be sure to submit them to mailbag@irahelp.com, to be answered on an upcoming Slott Report Mailbag, published every Thursday.
https://irahelp.com/the-five-year-rule-and-rollovers-to-employer-plans-todays-slott-report-mailbag/
