Advanced Underwriting Consultants

Question of the Day – July 22

Ask the Experts!

The professionals at Advanced Underwriting Consultants (AUC) answer the tax questions posed by producers.  Here’s the question of the day.

Question:  My client is a retired minister.  He has a 403(b) account that we are considering rolling over to an IRA.  Is there any compelling tax reason to leave the money in a 403(b) account?

Answer:  There might be.

Unlike with IRA distributions, a retired minister can use distributions from his 403b plan tax-free as part of a housing allowance.  There are certain requirements for the minister to be eligible for such tax-free distributions.  For a full explanation, see this article:

http://ministrycpa.blogspot.com/2012/10/403b-retirement-distributed-as-housing.html

That would be a potential advantage to him to leaving the money in a 403(b) plan instead of rolling it over to an IRA.

Have a question for the professionals at AUC?  Feel welcome to submit it by email.  We may post your question and the answer as the question of the day.