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Compliance September 23, 2010
House Approves Bill Allowing In-Plan Roth Conversions
The U.S. House of Representatives has approved a bill that includes provisions allowing retirement plan participants to roll over their assets into in-plan Roth accounts.
Reported by Rebecca Moore
The bill also allows participants in 457 plans to treat elective deferrals as Roth contributions, effective for tax years beginning after 2010.
Under the bill, if a section 401(k) plan, section 403(b) plan, or governmental section 457(b) plan has a qualified designated Roth contribution program, a distribution to an employee (or a surviving spouse) from an account under the plan that is not a designated Roth account is permitted to be rolled over into a designated Roth account under the plan for the individual (see “Roth 401(k) Provision in Broader Senate Bill“).
The legislation, approved by a 237 to 187 vote, now goes to the White House and is expected to be signed into law.