401k

[bogeyman700]

My 401k is in maine but i now live in idaho . I am retired at 63 living on ssi.

If i take money out of my 401k in maine will they take state tax from me in maine ?

[rynosback]

I would think it is all based upon the state that you reside in.  Have you tried calling the company that holds your 401k and asking them this question?  As I am sure that they have ALOT of people that now live in warmer all year round states.

Edited May 9, 2019 by rynosback

[bogeyman700]

Actually my money is in an ira not a 401k. 

[Barbaraok]

Who is your IRA with?  Are you filing Maine tax returns?  We have 403b contracts from different states across the country.  We reside in Texas, our only address for TIAA is Texas, they send 1099s to our address, and we then file federal tax return.

[Kirk W]

Welcome to the Escapee forums!

If you are concerned you can open a new IRA in Idaho and roll your present IRA into it. There is no tax consequences when you move the IRA funds to a different bank or financial agent. 

[Sehc]

You pay taxes based on the state you have as your official address. The investment company doesn't care, they will collect federal tax withholding.. If you work in a tax state you have to pay taxes on the income earned while working in that state. Nothing to do with a IRA.

[LindaH]

12 hours ago, Kirk W said:

If you are concerned you can open a new IRA in Idaho and roll your present IRA into it. There is no tax consequences when you move the IRA funds to a different bank or financial agent. 

I wanted to emphasis what Kirk said.  If you plan on doing this, it is VERY IMPORTANT that you do NOT cash out your Maine IRA and then take that money to open another IRA!  If you have control of the money at any time, you will be taxed on the money if you do this!

The best way to handle it is to do as Kirk suggests...open a new IRA and fill out the paperwork to have your new IRA transfer the money from your old IRA. 

However, I agree with others that you are unlikely to be taxed by Maine for any money you withdraw, but contact the company the IRA is with to be 100% certain.

 

[Dmitche4]

Your IRA follows you from state to state, example if you are a NYS resident and you take a required minimum distribution from an IRA that you set up in a different state it is considered NY income.  All IRA's are handled the same way, whether it is Morgan Stanley, Fidelity etc.  This works the same way as pensions that maybe administered from a different state i.e. Sears (Illinois) even though you worked in PA or NY. If you reside in X if it is taxable then it will be taxable in X.  Hopefully, I did not muddy the waters.....

David 

[bogeyman700]

On 5/10/2019 at 11:53 AM, Dmitche4 said:

Your IRA follows you from state to state, example if you are a NYS resident and you take a required minimum distribution from an IRA that you set up in a different state it is considered NY income.  All IRA's are handled the same way, whether it is Morgan Stanley, Fidelity etc.  This works the same way as pensions that maybe administered from a different state i.e. Sears (Illinois) even though you worked in PA or NY. If you reside in X if it is taxable then it will be taxable in X.  Hopefully, I did not muddy the waters.....

David 

this is the info I was looking for. I don't want to be taxed in two states .

Thanks

[Kirk W]

44 minutes ago, bogeyman700 said:

I don't want to be taxed in two states .

You would probably be wise to submit a partial year state income tax return to Maine as a notification that you no longer reside there and to turn off their tax interest. From the Maine Revenue Services:

Quote

Maine generally imposes an income tax on all individuals that have Maine-source income. 

 

[whj469]

If you own a home in ME it can be a little more complicated if you sell it and it is not your primary residence. Additionally, I also moved my 403b to an IRA because with the 403b they would take 10% of what I takeout and send it to the IRS and I didn't need them to send 10%. With the IRA they will not take funds from your disbursements and send then to the IRS if you don't want them to. The minimum disbursement from an IRA starts in the year that you become 70 and one half.  The no state income tax in TX, FL and a few more states is a big reason people domicile there. Good Luck

[hemsteadc]

1 hour ago, whj469 said:

. With the IRA they will not take funds from your disbursements and send then to the IRS if you don't want them to.

But you will still be responsible for the taxes April 15.

[Barbaraok]

Additionally, if you do not have 10% or some other amount withheld from distributions, then you had better be doing quarterly estimated tax payments or be able to show that you never have to pay income tax on your withdrawals.   You can't just wait until April 15th of the following year and pay in one lump sum - - that will earn you a tax penalty.  

[whj469]

Death and taxes none of us can get away from. While I don't pay the IRS quarterly I keep well ahead of what I owe at any point during the year. I remember when my father paid $1,500 quarterly and he forgot to send one or it was lost in the mail and before the IRS notified him it effective two tax years and he was fined and had to pay interest for both years. He never could understand why two years when he only missed one payment. The IRS took the first payment for the next year and applied it to the prior year so he was behind for the next year. He was 89 at the time and from then on I knew that I had to help him.

[Ray,IN]

On 5/9/2019 at 9:22 PM, Kirk W said:

Welcome to the Escapee forums!

If you are concerned you can open a new IRA in Idaho and roll your present IRA into it. There is no tax consequences when you move the IRA funds to a different bank or financial agent. 

Correct, when the process is completed within the time limit set by the IRS. It's been so long ago I forget the time limit, and it may have changed since 1990 anyway. I do remember it is best to have the receiving IRA already in place before closing the old IRA.

[Randyretired]

Awhile back I moved an IRA to Fidelity.  They were very helpful and guided me.  It was easy with their help.  I would bet other large and experienced companies such as Vanguard would offer this service.

[Ray,IN]

On 5/14/2019 at 9:07 PM, Randyretired said:

Awhile back I moved an IRA to Fidelity.  They were very helpful and guided me.  It was easy with their help.  I would bet other large and experienced companies such as Vanguard would offer this service.

That is the firm I went with too, back in 1990. Fidelity is quite different today, electronic automation makes it more difficult to speak with someone.

The first firm I contacted, the man I spoke with told me to make out a check for the transfer amount in his name; I never bothered to call back. That caused me to only deal with a large established company.