401k and 403b Plans

no >>>>> And why would you want to? You already paid taxes on that money.

You may be able to leave your 401k with the employer. Some plans will allow this some will not. Read your 401k Summary Plan to learn what your plan says. The BEST IDEA would be to transfer your 401k savings to your Traditional IRA. Select your IRA custodian, and tell them what you want to do. This IRA custodian will help you with this transfer. Doing a Trustee To Trustee Transfer is best. This would guarantee no tax withholding, no tax and no penalty. Now you have many more investment choices for your retirement savings. Here is one you can do, but it is not recommended. You can take the 401k money for your use. Here 20% will be withheld for income tax and and if applicable, the 10% penalty. But don't think that will pay the tax and penalty on this. The tax and penalty will likely be more than the the amount withheld . It is likely you will also need to pay state income tax on this amount. If have a new employer, some 401k plans will accept money from your former employer's 401k. You may be able to move your old 401k money to your new employer's 401k plan. Most 401k plans will not do this.

can you close out your 401k and still receive unemployment benefits

You can rollover your 401k account into any type of IRA, with the exception of an education IRA. However, you need to be careful and make sure that you do a direct rollover, or else you could be hit with taxes and penalties that are north of 40%.

Make sure that you do your research. A good link is eRollover.com (see attached)

You can`t do anything with it, other than take it to the bank it is made out to and deposit it.

Yes, but the contribution limit includes both, i.e., no more than $15,500 total in 2008 plus $5,000 "catch-up" if age 50 or over.

You should not cash the check since it is not addressed to you. In any case, the reason you are rolling it over is to avoid the tax consequences and penalties for cashing out your 401K. It is shortsighted to spend 401K money (even if it is not very much) since that money grows over time to help with your retirement.

The amount of taxes on 9300 dollars will depend on the number of dependents you claim. There are also deductions that can be taken for numerous different things, which may reduce your tax amount even more.

No, you cannot. You cannot transfer a 401k balance from your current employer to any other plan. Obviously, you can discontinue participation in the 401k and make contributions to a new or existing IRA in your name. But you cannot transfer the balance elsewhere. Unless however you are over the age of 59 1/2, in wich you would have access to the balance in your 401k plan, and would be eligible to roll it over.

Yes. You can roll a previous employer's 401k balance into a new employer's 401k. You can also roll a previous employer's 401k balance into an individual retirement account (IRA) if you wish to maintain control over the investments.

Since you are usually charged a fee for each account, it is best to have all of your IRA funds in one account. I recommend utilizing a self-directed IRA account from a firm such as PENSCO Trust, where you can have all types of investments, even real estate and businesses, in one account. They can set up subaccounts with any broker you may utilize and you only get charged fees once. Watch out for "free" IRA accounts. The sponsor can earn exorbitant fees hidden in the investments they offer or pay you below market rates to earn money from your account.

yes, but there are earned income limits that may prevent you from deducting a Traditional IRA on your taxes if you were covered by a 401(k)

As discussed here - http://www.savingtoinvest.com/2011/07/contributing-to-an-ira-and-roth-ira-if-you-already-have-a-401k.html - you can contribute to both (limits are different) based on income levels and meeting eligiblity rules.

It disapperars!

No, there is no age limit on putting money into a 401k. As long as you are still employed by the employer that sponsors the 401k, you are allowed to continue making tax-free contributions into the 401k.

Required Minimum Distributions (RMDs) from qualified employer plans generally must begin for the year the individual reaches age 70 1/2. However, RMDs can be delayed until the year the individual retires from the employer if he continues to work past age 70 1/2. However, this RMD exception does not apply to particiapants who are more-than 5% owners of the business sponsoring the qualified plan.

[IRC Sec. 401(a)(9)(C) and Reg. Sec. 1.408-8, Q&A-2]

"the limitation under Section 402(g)(1) on the exclusion for elective deferrals described in Section 402(g)(3) remains unchanged at $15,500. This limitation affects elective deferrals to Section 401(k) plans and to the Federal Government's Thrift Savings Plan, among other plans." http://www.irs.gov/newsroom/article/0,,id=174873,00.html

Check with your human resources department or the payroll department of your employer.

only if your plan allows in-service withdrawals....ask your HR or payroll dept.

3%

a 401k is an employer plan for the benefit of the employees, and an IRA is an individual plan

to get the money away from the previous employer and to continue tax-deferral

Yes. Whether or not you can deduct the IRA contribution depends on a variety of factors. Whether or not you can contribute to a Roth IRA depends on your income (or that of you and your spouse combined, if you are married). More information: http://beginnersinvest.about.com/cs/iras/a/iracontribution.htm

Whoever recordkeeps your old employer's plan (Fidelity, Vanguard, etc). If you don't know who that is, contact your Benefits Department or HR dept and they will tell you who it is.

There is no limit as to how many 401ks one is entitled to. However, if you participate in one through your current employer, you will most likely only be eligible for one plan.