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I am graduating from residency at the end of this month (June 2020) and starting a new job at the VA. My current employer is a state institution and I'll have about $18,000 in a governmental 457. I'd like to roll this money out of the 457 and I see three options:
1. Roll into Roth IRA
2. Roll into TSP as Roth contribution
3. Roll into TSP as traditional, pre-tax contribution
I'd prefer option 1 or maybe option 2 but I'm not sure of the effect on my MAGI. I file taxes as married filing jointly, and I estimate our total income this year will be about $184,000 between my wife and me. I've already maxed out my Roth IRA and a spousal Roth IRA this year. I know if I roll my 457 into a Roth account, I'll have to pay incvome taxes on that money, but I'm wondering if the money from the 457 would then also count against my MAGI, which would put me over the $193,000 threshold for contributing the max to a Roth IRA. If that's the case, then I'll probably just roll it into a traditional TSP.
To summarize, does the money in a 457 count against MAGI if rolling into a Roth IRA or Roth TSP? Thanks!
1. Roll into Roth IRA
2. Roll into TSP as Roth contribution
3. Roll into TSP as traditional, pre-tax contribution
I'd prefer option 1 or maybe option 2 but I'm not sure of the effect on my MAGI. I file taxes as married filing jointly, and I estimate our total income this year will be about $184,000 between my wife and me. I've already maxed out my Roth IRA and a spousal Roth IRA this year. I know if I roll my 457 into a Roth account, I'll have to pay incvome taxes on that money, but I'm wondering if the money from the 457 would then also count against my MAGI, which would put me over the $193,000 threshold for contributing the max to a Roth IRA. If that's the case, then I'll probably just roll it into a traditional TSP.
To summarize, does the money in a 457 count against MAGI if rolling into a Roth IRA or Roth TSP? Thanks!
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