Detailed Instructions: Given a passage and a query based on the passage, generate an unambiguous, concise and simple answer to the query from information in the passage. Note that the answer may not be present in exact form.
Problem:The easiest way to roll over a pension plan is to execute a trustee to custodian transfer. If you are married, company pension plans generally require a notarized signature of your spouse, who will be giving up his/her right to an annuity interest, in order for you to move the money into your IRA. When planning for a rollover, there are several other rules to keep in mind. For example, if you are age 55 or older when the separation from service occurs, you may take your company pension as a lump sum distribution without paying the 10% early withdrawal excise tax. You will be taxed on the distribution as ordinary income. What is a pension? Do I have to do anything to manage my pension? What if I leave my company before I retire? How does vesting work? When can I access my pension money? Can I take out a loan from my pension plan? Should I take a lump-sum payout or monthly payments? What are the advantages of taking a lump sum? Should I invest my lump-sum payout in an annuity? What's the difference between a single-life annuity and a joint-and-survivor annuity? Will I pay tax on my pension payouts? How should my pension affect my retirement planning? While you can opt to tap your 401k at any time you can't collect your pension until you've reached the predetermined retirement age. Nope. While you can opt to tap your 401(k) at any time (though you'll pay a huge penalty to do so before age 59.5), you Not until you reach retirement age. Typically that's 65, though many pension plans allow you to start collecting early retirement benefits as early as age 55. If you decide to start receiving benefits before you reach full retirement age, the size of your monthly payout will be less than it would have been if you'd waited. Ask the folks who run your plan to create a simple table showing you how your payments will vary depending on when you start. However, pension plans are required to withhold 20% of the proceeds if the check is made payable to you. This means in order to roll 100% of your pension distribution into an IRA, you will need to come up with the tax withholding out of your own pocket. Otherwise you will owe taxes on the money you didn't rollover and possibly a tax penalty if you are under age 55. Nope. While you can opt to tap your 401(k) at any time (though you'll pay a huge penalty to do so before age 59.5), you can't collect your pension until you've reached the retirement age determined by your pension plan. Typically full retirement age 65, though many plans allow an early retirement that could start as soon as age 55. If you decide to start receiving benefits before you reach full retirement age, the size of your monthly payout will be less than it would have been if you ... Rick's Insights. 1 Company retirement plans are required to withhold 20% of distributions made directly to a person for income taxes. 2 Distributions from a company plan are not subject to the 10% early withdrawal penalty if you are age 55 and separated from service. Follow the Rules When Rolling Over Your Pension to an IRA Posted on April 24, 2013 by Rick Rodgers Many companies are closing out their pension plans, giving workers the opportunity to roll them over to an IRA or another plan. Each plan's rules vary (check yours to be sure), but you may be able take money out of your retirement account penalty-free before age 59 if you use it for expenses after the onset of a sudden disability, or for unreimbursed medical expenses that are more than 7.5% of your adjusted gross income (10% if you're under age 65). Query: at what age can i pull my pension
Solution:
You can pull your pension at the age of fifty nine and half. However if you are age 55 or older when the separation from service occurs, you may take your company pension as a lump sum distribution without paying the 10% early withdrawal excise tax. You will be taxed on the distribution as ordinary income.