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Which account type should I open to complete my 401k rollover?

Most plans we see are Traditional 401(k) plans, which means you must roll over into a Traditional IRA. However, if your plan is a Designated Roth Account (like a Roth 401(k)), you must roll over into a Roth IRA. Lastly, some plans actually allow you contribute both Roth and Traditional funds. In that case, you’ll need to open both a Roth IRA and a Traditional IRA account. If you are not sure, just remember that Traditional plans allow you to invest pre-tax dollars, whereas with Roth plans you must invest post-tax dollars. In both cases your account must meet our $500 minimum.

See the below chart for more details about where you should “roll to” depending on where you are rolling from.

 

Note: This chart has been adapted from the IRS Rollover Chart and modified Wealthfront-specific account support. Source:https://www.irs.gov/pub/irs-tege/rollover_chart.pdf

Please see the IRS website for more information

 
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