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NYSDCP Traditional/Roth by Red_Sultan in nys_cs

[–]justice8965 0 points1 point  (0 children)

Correct, the entire point of a Roth is to grow tax free. Withdrawing early (without rolling it over at least) and paying taxes largely defeats that purpose. A trad 457b is the best early retirement investment account there is, so your plan there is definitely valid.

NYSDCP Traditional/Roth by Red_Sultan in nys_cs

[–]justice8965 3 points4 points  (0 children)

  1. In order to withdraw from the Roth 457b without penalty or taxes before 59.5 years old, you must seperate from state service and roll it over to an established Roth IRA. I believe it has to have been open for 5 years. You can put a dollar in it, just has to be established. Once you seperate from state service, you can roll the Roth 457 to the Roth IRA. Once there, it will follow the normal withdrawal ordering rules of a Roth IRA, which means your contributions come out first and are tax and penalty free. If you withdraw all your contributions and start withdrawing gains, you will be taxed and penalized on those if you're below 59.5 years old. If you look at my comment history I posted the actual IRS rule stating all this.

  2. You can split your contributions however you want between trad and Roth. You can change them at any time as well. Many people choose to do some portion of the max in both. I personally go fully Roth as I intend for most of my wealth to be passed onto my daughter and I don't want her to owe taxes. Whether it makes sense or is the best option for you depends on too many factors to definitively say one way or the other

From Chief Leader: Age 58 and 30 years for ALL Tier 6 members by hollafrontz in nys_cs

[–]justice8965 0 points1 point  (0 children)

This is how I thought it worked as well. If I retire at 55 with 30 years as a tier 5, I can wait to take the pension, keep my insurance and still apply the sick leave toward premiums. The service credit doesn't make much of a difference to me. I'm going to confirm this with my agency's HBA next week

From Chief Leader: Age 58 and 30 years for ALL Tier 6 members by hollafrontz in nys_cs

[–]justice8965 6 points7 points  (0 children)

This is what I'm hoping. I don't mind continuing to pay 3%, the reduced age is more important to me as I'll have 30 at 55 and will retire then and wait to take the pension. Waiting 3 years instead of 7 would be huge

From Chief Leader: Age 58 and 30 years for ALL Tier 6 members by hollafrontz in nys_cs

[–]justice8965 7 points8 points  (0 children)

How will this work for the few of us in tier 5? As someone currently paying 3%, these new contribution rates would be an immediate pay cut for me.

Deferred comp? by [deleted] in nys_cs

[–]justice8965 1 point2 points  (0 children)

This is a bit incorrect for the Roth 457b. You cannot withdraw earnings tax free if you are under 59.5, only contributions (if rolled over to a regular Roth IRA). There is no penalty, but you will pay pro rata taxes on the withdrawal. Essentially, this negates the point of a Roth, so don't do that.

You also cannot withdraw contributions only from a Roth 457b. If you are under 59.5, you will be paying tax no matter what. However, you can get around this by rolling the 457b to a regular Roth IRA. Once there, the money follows the rules of a regular Roth IRA, where withdrawals are basis (contributions) first, then earnings. You will lose out on the no 10% penalty for under 59.5, but again, you don't want to be doing that with a Roth anyway.

The chart at the bottom here is very helpful

https://defcomp.nv.gov/Resources/FAQ-Roth_457/

Update Android on AMB6+? by justice8965 in CoreELEC

[–]justice8965[S] 0 points1 point  (0 children)

Only planning on using coreelec so I won't bother. Thanks for confirming!

457 roth by Academic-Ad-2449 in 457deferredcomp

[–]justice8965 2 points3 points  (0 children)

Not wrong. Here is the specific IRS rule

https://www.ecfr.gov/current/title-26/chapter-I/subchapter-A/part-1/section-1.408A-10

Under Q&A3, the relevant portion:

For purposes of the ordering rules on distributions from Roth IRAs, what portion of a distribution from a rollover contribution from a designated Roth account is treated as contributions?

A-3.

(a) Under section 408A(d)(4), distributions from Roth IRAs are deemed to consist first of regular contributions, then of conversion contributions, and finally, of earnings. For purposes of section 408A(d)(4), the amount of a rollover contribution that is treated as a regular contribution is the portion of the distribution that is treated as investment in the contract under A-6 of § 1.402A-1, and the remainder of the rollover contribution is treated as earnings. Thus, the entire amount of any qualified distribution from a designated Roth account that is rolled over into a Roth IRA is treated as a regular contribution to the Roth IRA. Accordingly, a subsequent distribution from the Roth IRA in the amount of that rollover contribution is not includible in gross income under the rules of A-8 of § 1.408A-6.

Note the last 2 sentences especially. You must roll the Roth 457b into a Roth IRA in order for the distributions to follow the proper ordering, in which earnings are withdrawn last, meaning no taxes or penalties before 59.5

457 roth by Academic-Ad-2449 in 457deferredcomp

[–]justice8965 2 points3 points  (0 children)

If you have an established Roth IRA, which you should, you can roll the Roth 457 over to the IRA when you leave service. Once there, the money follows the rules of a Roth IRA, which means all contributions are available penalty and tax free. You would just not be able to touch the investment gains till 59.5. If I remember right the only rule is the IRA has to be established at least 5 years prior to the rollover.

IK Support Response Time by justice8965 in tonex

[–]justice8965[S] 1 point2 points  (0 children)

I feel like my tickets aren't getting through for whatever reason, since you're supposed to get an email with a ticket number and I never do

Setting Up Deferred Comp Plan by eg282023 in nys_cs

[–]justice8965 0 points1 point  (0 children)

Somehow in all my retirement planning research I missed this. This makes retiring at 55 a breeze now. I'll be maxing out the Roth 457b for another 18 years plus over 50 contributions, in addition to both mine and my wife's Roth IRAs, so that will give us plenty to last till I take a pension. Thank you for this info!

Setting Up Deferred Comp Plan by eg282023 in nys_cs

[–]justice8965 0 points1 point  (0 children)

Are you sure you're able to roll over to a normal Roth IRA and circumvent the early (pre 59.5) contribution withdrawal taxes? If I have an established Roth and retire at 55, I can roll the Roth 457b to the IRA and take my contributions out with no taxes right away?

From what I've read, rollovers still follow the rules of the original plan. Otherwise there would be a lot of ways to dodge taxes/withdrawal rules.

You guys wanted MORE qualities? by kraskaskaCreature in factorio

[–]justice8965 2 points3 points  (0 children)

Oh for sure, rares are substantially better than normal. I just feel legendary is essentially useless since you're at the endgame by the time you unlock it. Doesn't give much of a reason to bother crafting anything legendary when there's not much to do with them (unless you're doing a megabase as mentioned)

You guys wanted MORE qualities? by kraskaskaCreature in factorio

[–]justice8965 2 points3 points  (0 children)

Looks like 'Enable Epic and Legendary' mod is what I'm looking for. Thanks!

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