Retirement Package Vacation Pay Rollover

Home Fairmark Forum Retirement Savings and Benefits Retirement Package Vacation Pay Rollover

Viewing 4 posts - 1 through 4 (of 4 total)
  • Author
    Posts
  • #16289
    kburkett
    Participant

    Upon retirement can you rollover unused vacation pay to an IRA??

    #16297
    Kaye Thomas
    Moderator

    No, rollovers are for money moving from one retirement plan to another. Unused vacation pay is not paid out of a retirement plan.

    #16311
    kburkett
    Participant

    Thank you so much for your reply could we further discuss possible options to tax shelter the unused vacation pay
    I believe that the IRS will allow the unused PTO to be contributed to a company 401k as long as the plan allows it and as long any PTO money does not exceed the max contribution limits of the individual.

    So then would that also be allowed in a 403b? And then upon the official retirement date the entire account could be rolled over to an IRA……so for all practical purpose someone could increase their payroll contributions to match OR account for that of the PTO amount

    I would greatly appreciate your thoughts

    #16512
    Alan S.
    Participant

    This following explanation could be of use. Not sure if it is up to date or was later expanded to 403b plans. In any event, the 403b plan will apply it’s own provisions to this.
    https://www.thetaxadviser.com/issues/2010/jan/irsclarifiesruleforcontributingunusedpaidtimeofftosec401-k-plans.html#:~:text=401(k)%20plans%20to%20provide,the%20maximum%20contribution%20under%20Sec.

    • This reply was modified 6 months ago by Alan S..
    • This reply was modified 6 months ago by Alan S..
Viewing 4 posts - 1 through 4 (of 4 total)
  • You must be logged in to reply to this topic.