Guide to the Fundamental Rules of Tax-Free Roth 401(k)s

Program Name: Appleby’s Guide to the Fundamental Rules of Tax-Free Roth 401(k)s

Overview

Like Roth IRAs, contributions to designated Roth accounts (DRA) - including Roth 401(k)’s - are made with funds that have already been taxed and qualified distributions are tax-free. Roth 401(k)s are becoming increasingly attractive to small business owners and plan participants who are looking to capitalize on the potential tax-free nature of growth and Roth IRA contributions.

Interested parties can help to maximize the Roth benefits and avoid pitfalls by ensuring that the applicable rules are followed.

Major Topics

• ·         General technical rules that apply to designated Roth accounts (DRA)
• ·         Operational requirements that apply to DRAs
• ·         In-Plan Roth Rollovers
• ·         DRA Distribution rules
• ·         Qualified vs Nonqualified distributions
• ·         Key differences between DRAs and Roth IRAs
• ·         DRAs and rollover contributions
• ·         Beneficiary Options for Roth Accounts

Learning objectives

• ·         To understand how Roth IRA contributions can be made and who were eligible to make those contributions.
• ·         To understand the operational and compliance requirements that apply to Roth conversions.
• ·         To understand the limitations that apply to recharacterizing Roth activity.
• ·         To understand the impact of changes to the recharacterization rules under the Tax Cuts and Jobs Act of 2017.
• ·         To understand the transfer or rollover rules that apply to Roth IRAs and Roth 401(k)s.
• To understand the beneficiary options that apply to Roth accounts.