To initiate an incoming rollover, complete and return the Incoming Direct Rollover form (pdf) or call MSRS at 800-657-5757, option 3 to request the form. You'll also want to contact your previous plan provider to confirm that those assets are eligible for rollover and ask about their paperwork requirements.
Deferring Social Security payments, rolling over old 401(k)s, setting up IRAs to avoid the mandatory 20% federal income tax, and keeping your capital gains taxes low are among the best strategies for reducing taxes on your 401(k) withdrawal.
The Terms and Conditions for Withdrawal document is specific to your employer-sponsored retirement account. Therefore, please contact us to obtain this document. Generally, the funds in your retirement account are available upon retirement, death, disability or termination of employment.
"If you're in the 22% federal tax bracket, you'll owe that 22%. You'll owe 7% Minnesota (state tax) and you're going to owe that 10% penalty," said Moore. Based on Moore's equation, a $10,000 withdrawal becomes $6,100 after paying tax and fees. "If it's hardship (withdrawal) you avoid that 10%," added Moore.