Move 401(k) or Rollover to IRA

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Topic Author
mrploppy
Posts: 80
Joined: Thu May 04, 2017 5:20 pm

Move 401(k) or Rollover to IRA

Post by mrploppy »

For background on my situation have a look at
viewtopic.php?f=22&t=251107
but basically - UK citizen, UK resident, with a leftover 401(k) from working in the US.

Now that my ex-company is moving its 401(k) plan to a different provider, I'm told I have the option of leaving mine with Fidelity and rolling over to an IRA.

Things I need to know, off the top of my head:
1. Is it even possible seeing as I don't have a US address?
2. Is rolling over a taxable event?
3. Is growth in the IRA taxable (in the US and/or the UK)?
4. Will an IRA have the same withdrawal options as I had with my 401(k)? You may not know the answer to that, but I mention it here for my benefit.
5. I presume withdrawals are taxable in the same way as the 401(k).

That'll do for starters! I wonder if this thread will live for 3 years like the aforementioned one?
TedSwippet
Posts: 5166
Joined: Mon Jun 04, 2007 4:19 pm
Location: UK

Re: Move 401(k) or Rollover to IRA

Post by TedSwippet »

mrploppy wrote: Wed Mar 31, 2021 5:07 pm 1. Is it even possible seeing as I don't have a US address?
Opening a new IRA (or 401k) with a company with which you don't already hold accounts would very likely be impossible from cold as an NRA, but if your ex-employer switches their 401k provider, it's likely they can arrange a transfer for your funds also.

From what you write, they appear to already have offered this. Did their communication to you hold any sense of them having looked into your particular circumstances as an NRA, or was it just a boilerplate message sent to all plan participants (99.9% of whom would be US residents/citizens)?
mrploppy wrote: Wed Mar 31, 2021 5:07 pm 2. Is rolling over a taxable event?
Not taxable in the US under normal rules, and explicitly excluded from UK tax under treaty article 18 paragraph 1 parenthetical clause ("may be taxed as income of that individual only when, ... (and not transferred to another pension scheme)."
mrploppy wrote: Wed Mar 31, 2021 5:07 pm 3. Is growth in the IRA taxable (in the US and/or the UK)?
Not annually. If not withdrawn then not taxable under normal US rules, and as above, protected by treaty from annual UK tax on internal plan growth.
mrploppy wrote: Wed Mar 31, 2021 5:07 pm 4. Will an IRA have the same withdrawal options as I had with my 401(k)? You may not know the answer to that, but I mention it here for my benefit.
It's Fidelity. We know from past experience that anything could happen (or not) here. Not just that, but it might vary from month to month depending on how they reinterpret the rules over time!

Comments about Fidelity's poor implementation of treaty claims aside, in general the withholding and other tax rules for an IRA payer are the same as for a 401k payer. So ... there is at least a decent chance that having gone through this dance with Fidelity over your 401k, you can get the same conditions to hold for an IRA. One slight improvement could be that once rolled into an IRA, your 401k plan sponsor no longer has any control or say over what you can or cannot do.
mrploppy wrote: Wed Mar 31, 2021 5:07 pm 5. I presume withdrawals are taxable in the same way as the 401(k).
Right. Or at least, should be. The US/UK treaty doesn't differentiate between the two, and while there are a few tiny differences on the US side (protection from bankruptcy, age-55 access to a 401k for certain cases), none of these should affect you.

So, should you roll over to an IRA, or not? Tricky question.

Who are your ex-employer moving their 401k to? If Vanguard, they are at least a somewhat known quantity when it comes to handling NRAs. Not that they do it well, or efficiently, or seamlessly, but they are at least large enough to expect some level of competency from them. If to a much smaller organisation, that might raise questions about whether or not they would be prepared to take the time to understand all the nuances of handling NRA pensions.

Have you asked Fidelity outright what will happen with withdrawals and withholding if you rollover your 401k to an IRA? It's always possible that they might surprise you with a simple answer that turns out to be right.

Other aspects ...

What funds do you currently hold, and can you replicate them in (a) the new 401k, or (b) a rollover IRA? What charges are you currently paying in your 401k, and will they increase or decrease across the move (one might hope that your ex-employer is moving to a better and/or cheaper for you 401k, but less scrupulous employers might move instead to one that decreases their cost even if it increases yours).

In an IRA you will have a choice of everything; in a 401k, only what the plan sponsor allows. In a good 401k, the limited options are nevertheless excellent, and the charges very skimpy indeed -- I have one like this which I have held on to even though I could roll it into my IRA. In a poor one, the limited options tend to be expensive and a bit boutique. How do the investment options in the new 401k compare with those in a Fidelity IRA?
Topic Author
mrploppy
Posts: 80
Joined: Thu May 04, 2017 5:20 pm

Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

As always, thanks for these detailed answers. I shall try and address them as best I can, given that I only learned yesterday of the impending 401(k) move and I don't have much information yet.
TedSwippet wrote: Thu Apr 01, 2021 3:20 am
mrploppy wrote: Wed Mar 31, 2021 5:07 pm 1. Is it even possible seeing as I don't have a US address?
Opening a new IRA (or 401k) with a company with which you don't already hold accounts would very likely be impossible from cold as an NRA, but if your ex-employer switches their 401k provider, it's likely they can arrange a transfer for your funds also.

From what you write, they appear to already have offered this. Did their communication to you hold any sense of them having looked into your particular circumstances as an NRA, or was it just a boilerplate message sent to all plan participants (99.9% of whom would be US residents/citizens)?
It was always the case, once I left the employer, that I had the option, in theory, of rolling over into an IRA. I say "in theory" because it may well be rejected were I to try it, due to address requirements. You're correct, it was just a boilerplate message. In fairness, I wouldn't expect a US company with few UK employees (and none since I left, I think) to be au fait with Fidelity's NRA rules.
TedSwippet wrote: Thu Apr 01, 2021 3:20 am
mrploppy wrote: Wed Mar 31, 2021 5:07 pm 2. Is rolling over a taxable event?
Not taxable in the US under normal rules, and explicitly excluded from UK tax under treaty article 18 paragraph 1 parenthetical clause ("may be taxed as income of that individual only when, ... (and not transferred to another pension scheme)."
Excellent.
TedSwippet wrote: Thu Apr 01, 2021 3:20 am
mrploppy wrote: Wed Mar 31, 2021 5:07 pm 3. Is growth in the IRA taxable (in the US and/or the UK)?
Not annually. If not withdrawn then not taxable under normal US rules, and as above, protected by treaty from annual UK tax on internal plan growth.
Excellent again.
TedSwippet wrote: Thu Apr 01, 2021 3:20 am
mrploppy wrote: Wed Mar 31, 2021 5:07 pm 4. Will an IRA have the same withdrawal options as I had with my 401(k)? You may not know the answer to that, but I mention it here for my benefit.
It's Fidelity. We know from past experience that anything could happen (or not) here. Not just that, but it might vary from month to month depending on how they reinterpret the rules over time!

Comments about Fidelity's poor implementation of treaty claims aside, in general the withholding and other tax rules for an IRA payer are the same as for a 401k payer. So ... there is at least a decent chance that having gone through this dance with Fidelity over your 401k, you can get the same conditions to hold for an IRA. One slight improvement could be that once rolled into an IRA, your 401k plan sponsor no longer has any control or say over what you can or cannot do.
Regarding withdrawal options, there's only one way to find out, I suspect, and that involves calling them up.

The fact that the employer is still "involved" in the 401(k) even after one leaves their employment has been a bit of an eye-opener for me. I had no idea that that would be the case. Whereas they've been very accommodating, they may not always be that way. Plus there are fewer and fewer people still employed there that remember me, so at some point I'll become "some guy who used to work for us a long time ago, apparently, and who I've never met, is asking me to do something for him".
TedSwippet wrote: Thu Apr 01, 2021 3:20 am
mrploppy wrote: Wed Mar 31, 2021 5:07 pm 5. I presume withdrawals are taxable in the same way as the 401(k).
Right. Or at least, should be. The US/UK treaty doesn't differentiate between the two, and while there are a few tiny differences on the US side (protection from bankruptcy, age-55 access to a 401k for certain cases), none of these should affect you.
Good.
TedSwippet wrote: Thu Apr 01, 2021 3:20 am So, should you roll over to an IRA, or not? Tricky question.

Who are your ex-employer moving their 401k to? If Vanguard, they are at least a somewhat known quantity when it comes to handling NRAs. Not that they do it well, or efficiently, or seamlessly, but they are at least large enough to expect some level of competency from them. If to a much smaller organisation, that might raise questions about whether or not they would be prepared to take the time to understand all the nuances of handling NRA pensions.

Have you asked Fidelity outright what will happen with withdrawals and withholding if you rollover your 401k to an IRA? It's always possible that they might surprise you with a simple answer that turns out to be right.

Other aspects ...

What funds do you currently hold, and can you replicate them in (a) the new 401k, or (b) a rollover IRA? What charges are you currently paying in your 401k, and will they increase or decrease across the move (one might hope that your ex-employer is moving to a better and/or cheaper for you 401k, but less scrupulous employers might move instead to one that decreases their cost even if it increases yours).

In an IRA you will have a choice of everything; in a 401k, only what the plan sponsor allows. In a good 401k, the limited options are nevertheless excellent, and the charges very skimpy indeed -- I have one like this which I have held on to even though I could roll it into my IRA. In a poor one, the limited options tend to be expensive and a bit boutique. How do the investment options in the new 401k compare with those in a Fidelity IRA?
They are moving to Principal www.principal.com who I've never heard of. That's not to say they're not a big player (they may well be) - but they're not Fidelity, Vanguard, Schwab or any of the usual names.

Clearly, I need to speak to Fidelity. I also need to get answers from Principal, once I've established a contact with them. As I say, this has come as a bit of shock and information is limited at the moment. I have about a month before "the move" happens.

I currently hold one fund, a target retirement date Fidelity fund (so I presume that would be available in a Fidelity IRA). I used to have a number of different funds, rebalanced once, reallocated twice, but finally took the easy option. In fairness, the fund I have has done (and is still doing) very well. There is an almost identical Fidelity fund available through Principal. TBH, I've never paid attention to fees, but I guess they're really low - otherwise I would have noticed! Very little info available from Principal as of yet.

Thanks again, and watch this space!
Topic Author
mrploppy
Posts: 80
Joined: Thu May 04, 2017 5:20 pm

Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

First update! Don't know if anyone's interested, but I'll document anyway - as much for my own benefit.

I spoke to Fidelity today to ask the fundamental question - would it even be possible for me to rollover to an IRA, given that I don't have a US address? It took absolutely ages for someone to speak to someone else but the good news is that it is possible for me. But it's only possible because I already hold a 401(k) account with them.

The bad news is that the rollover can't be done online or over the phone. It'll involve paper forms, with a covering "letter of intent" from me - containing words I hope they'll give me. That sounds like the long pole in the tent. They said that the actual transfer of the money from one account to another is quick (overnight, I think).

Existing arrangements like periodic withdrawals will need to be re-done for the IRA. As will the W-8BEN I presume. I read a horror story on another forum regarding periodic payments from an IRA being refused for UK citizens, so I'll need to make sure that's not the case before proceeding. I haven't decided for sure whether this is what I'm going to do but I'll need to decide shortly because the 401(k) moves at the of April.
TedSwippet
Posts: 5166
Joined: Mon Jun 04, 2007 4:19 pm
Location: UK

Re: Move 401(k) or Rollover to IRA

Post by TedSwippet »

mrploppy wrote: Thu Apr 01, 2021 11:13 am First update! Don't know if anyone's interested, but I'll document anyway - as much for my own benefit.
I'm following the saga. Much like I might follow a soap opera (though in practice I don't watch any -- attention vampires!).
mrploppy wrote: Thu Apr 01, 2021 11:13 am I spoke to Fidelity today to ask the fundamental question - would it even be possible for me to rollover to an IRA, given that I don't have a US address? It took absolutely ages for someone to speak to someone else but the good news is that it is possible for me. But it's only possible because I already hold a 401(k) account with them.

The bad news is that the rollover can't be done online or over the phone. It'll involve paper forms, with a covering "letter of intent" from me - containing words I hope they'll give me. That sounds like the long pole in the tent. They said that the actual transfer of the money from one account to another is quick (overnight, I think).
Both the above are what I would have predicted (should have put it in writing upthread!), since it pretty well mirrors the experience I had with Vanguard when I opened a Roth IRA with them as a nonresident alien, alongside my existing Vanguard 401k and tIRA.

As it turned out, the paperwork wasn't all that horrific, and Vanguard were pretty slick about acting on it once they received it. They did insist on a 'wet signature' at the time, but post-covid, a lot of organisations will now accept paper forms that are signed and then scanned into PDFs and sent via email or secure message system, so probably worth looking into that possibility.
mrploppy wrote: Thu Apr 01, 2021 11:13 am Existing arrangements like periodic withdrawals will need to be re-done for the IRA. As will the W-8BEN I presume. I read a horror story on another forum regarding periodic payments from an IRA being refused for UK citizens, so I'll need to make sure that's not the case before proceeding. I haven't decided for sure whether this is what I'm going to do but I'll need to decide shortly because the 401(k) moves at the of April.
My sense is that having won this battle once already with Fidelity, it should be easier to win it a second time ("prior art"!). As already noted, the IRS rules for payments to NRAs are broadly the same for 401ks and IRAs, as are the US/UK treaty terms. Not sure what horror story you read elsewhere, but perhaps it's old? Or maybe just Fidelity doing their thing of acting randomly.

Have you investigated Principal yet? If it were me, and having looked at a few reviews on Principal, I think I might prefer the known devil to the unknown one. I guess it now depends on Principal's value proposition, and what they say (or don't say) regarding support for NRAs.

It's a bit of a pain having got everything running smoothly with Fidelity to now have to navigate this hiccup though, isn't it?
Topic Author
mrploppy
Posts: 80
Joined: Thu May 04, 2017 5:20 pm

Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

TedSwippet wrote: Thu Apr 01, 2021 12:40 pm
mrploppy wrote: Thu Apr 01, 2021 11:13 am First update! Don't know if anyone's interested, but I'll document anyway - as much for my own benefit.
I'm following the saga. Much like I might follow a soap opera (though in practice I don't watch any -- attention vampires!).
mrploppy wrote: Thu Apr 01, 2021 11:13 am I spoke to Fidelity today to ask the fundamental question - would it even be possible for me to rollover to an IRA, given that I don't have a US address? It took absolutely ages for someone to speak to someone else but the good news is that it is possible for me. But it's only possible because I already hold a 401(k) account with them.

The bad news is that the rollover can't be done online or over the phone. It'll involve paper forms, with a covering "letter of intent" from me - containing words I hope they'll give me. That sounds like the long pole in the tent. They said that the actual transfer of the money from one account to another is quick (overnight, I think).
Both the above are what I would have predicted (should have put it in writing upthread!), since it pretty well mirrors the experience I had with Vanguard when I opened a Roth IRA with them as a nonresident alien, alongside my existing Vanguard 401k and tIRA.

As it turned out, the paperwork wasn't all that horrific, and Vanguard were pretty slick about acting on it once they received it. They did insist on a 'wet signature' at the time, but post-covid, a lot of organisations will now accept paper forms that are signed and then scanned into PDFs and sent via email or secure message system, so probably worth looking into that possibility.
mrploppy wrote: Thu Apr 01, 2021 11:13 am Existing arrangements like periodic withdrawals will need to be re-done for the IRA. As will the W-8BEN I presume. I read a horror story on another forum regarding periodic payments from an IRA being refused for UK citizens, so I'll need to make sure that's not the case before proceeding. I haven't decided for sure whether this is what I'm going to do but I'll need to decide shortly because the 401(k) moves at the of April.
My sense is that having won this battle once already with Fidelity, it should be easier to win it a second time ("prior art"!). As already noted, the IRS rules for payments to NRAs are broadly the same for 401ks and IRAs, as are the US/UK treaty terms. Not sure what horror story you read elsewhere, but perhaps it's old? Or maybe just Fidelity doing their thing of acting randomly.

Have you investigated Principal yet? If it were me, and having looked at a few reviews on Principal, I think I might prefer the known devil to the unknown one. I guess it now depends on Principal's value proposition, and what they say (or don't say) regarding support for NRAs.

It's a bit of a pain having got everything running smoothly with Fidelity to now have to navigate this hiccup though, isn't it?
With regard to paper forms, I would hope that they at least can send them to me electronically so that I can print them. They don't have a great record of sending mail expeditiously. All the better if I can then submit them electronically.

The horror story was on another forum (you may even participate there). I wasn't sure what the rules were regarding linking to other forums, but if you were to enter "Fidelity IRA distribution to UK-periodic No-no" into your favourite search engine, you would find it (if it doesn't break the rules, I'll post the link). It was started in 2016, so not that old. The form mentioned in that OP does indeed exist and does say what he says it says. I have no idea if it's current though - I haven't read the whole thread. Seems like nonsense to me based on my own experience, albeit that my withdrawals come from a 401(k) and not an IRA.

I've only done a small amount of research into Principal, and it doesn't look great. I won't have any plan-specific details until I either speak to a contact there (which I've been promised shortly) or actually make the move (which kind of defeats the purpose).

I'm coming to the conclusion that staying with Fidelity would be the path of least resistance now that I've trained them to do what I want! As long as I can get the IRA to behave exactly like my 401(k) is.

Stay tuned!
Topic Author
mrploppy
Posts: 80
Joined: Thu May 04, 2017 5:20 pm

Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

In retrospect, maybe I was a little melodramatic in using the term "horror story" above. However, it is still "less-than-ideal".

For those interested, the discussion is here
https://talk.uk-yankee.com/index.php?topic=88242.0
where someone was trying to arrange automatic periodic withdrawals from their IRA with Fidelity, and were being refused due to their NRA status. Admittedly, it was 4 years ago so policy may have changed but the form mentioned, with the wording quoted, is still present on the Fidelity website. It seems the policy wasn't unique to Fidelity either.

My situation is pretty much identical (although I haven't decided whether to rollover yet), except for the fact that I am fortunate to still have a US bank account and wouldn't need US dollar cheques (checks!) sent overseas.

I'm struggling to understand the rationale behind such a policy. As you know, if you've followed my pervious topic, I have succeeded in getting automatic periodic withdrawals from my 401(k) to my US bank account with 0% tax withholding (due to W-8BEN). The form I completed in order to initiate this was supplied to my by me ex-employer (the plan sponsor) and not by Fidelity directly, and had pretty much identical questions to the "official" Fidelity form linked to in the other forum, but without the wording regarding NRAs.

I feel a phone call to Fidelity's IRA dept. coming on. Unfortunately, as others have found, they will sometimes tell you one thing on the phone and then do something completely different in practice.
Topic Author
mrploppy
Posts: 80
Joined: Thu May 04, 2017 5:20 pm

Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

Duly made the phone call to Fidelity today - they were open on Good Friday, which is nice.

Spoke to someone in the IRA section, hoping to get the same answers from two different people on two different days:
1. Would I be able to rollover to an IRA without a foreign address.
2. Would I be able to set up automatic periodic withdrawals (I didn't broach the subject of withholding).

Again he had to speak to someone in the back office, which took a while, but the answer to both questions came back as yes.

For the first step he's even emailed me a form that I'll need to fill in and mail back to them, so I believe this will work.

For the second part, I'm not yet convinced. He was pretty adamant, but yet somewhat vague, that it would be possible by just calling them to set it up. He said he'd checked that with the back office. I may call a third time and press them on this point - and maybe ask about the online form that specifically precludes NRAs from doing so. Should have done it today I suppose but I'd run out of steam by that point.

I don't yet know what Principal will allow with regard to withdrawals should I move my 401(k) there. I'm reluctant to dive into doing the rollover with Fidelity yet until I'm a little more confident that automatic periodic withdrawals will work. Worst case scenario with Fidelity appears to be how I started off with the 401(k) - calling up every month to request a withdrawal and having 30% tax withheld regardless of W-8BEN. Then claiming the tax back. It's a right royal pain, but not the end of the world.
Topic Author
mrploppy
Posts: 80
Joined: Thu May 04, 2017 5:20 pm

Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

Your summing up (in the topic of different Fidelity funds) is exactly the thought process that I'm going through at the moment. Whereas initially I was in the "cut the ties with the 401(k) and rollover to IRA with Fidelity" camp, I'm now leaning to the "it'll be so much less hassle to just let the 401(k) transfer happen" camp. Despite what Fidelity have told me on the phone regarding automatic periodic withdrawals from an IRA, I have zero confidence (based on others' experience) that that will actually be the case when I come to try it. Plus it means sending forms by mail to the US pretty damn quick.

When I set up my 401(k) periodic withdrawals from Fidelity, I did it via my ex-company (plan administrator) - because you have to, I guess. I've revisited the process - the form they supplied me to fill in back then was not a Fidelity form per se - and there was no statement on it saying "can't use for NRAs". My hope is that by going through my ex-company the same can happen this time. I doubt the automatic withdrawals I currently have will just carry over to Principal - I'm fully expecting to have to go through setting that up again. And the tax withholding of course, but that could be the same with Fidelity.

There may be hidden fees with Principal that I don't know about yet but I keep coming back to what price do you put on having someone on the other side of the pond to help things along - someone I can communicate with via email. My biggest fear with an IRA at Fidelity is that basically I'd be on my own trying to fix things from here.

So, some of the questions I have re Principal are pretty simple
1. I'm assuming they can't refuse to accept my 401(k) - and cash me out!
2. Are they used to dealing with NRAs (that can be as painful as not being able to enter a UK postcode into a zip code field in an online form)?
3. Do they have a toll-free (or call collect) phone number for the UK - because it's quite common to be on the phone for an hour or so?
4. Will they EFT or ACH withdrawals to my US bank fee free?

Then come the harder questions
5. Automatic periodic withdrawals
6. W-8BEN.

I'm hoping to get answers to some of these questions this week.

Stay tuned!
Topic Author
mrploppy
Posts: 80
Joined: Thu May 04, 2017 5:20 pm

Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

Well, I've sort of half bitten the bullet. Having read some pretty horrendous reviews of Principal Finance, and with little or no information to go on with regard to how well they accommodate NRAs, I have taken the first steps to rolling over my 401(k) into an IRA with Fidelity. I've filled in forms, attached the extra stuff they asked for and mailed it via Royal Mail International Tracked and Signed to the USA. Goodness knows how long mail takes these days but short of trying to find an overnight courier like FedEx - which seems nigh on impossible in this country - I had little choice.

I realise that the fees might be slightly higher in an IRA and that I won't have the convenience of a 401(k) plan administrator to call on but there are so many unknowns (and maybe unknown unknowns - they're the worst!) about Principal that I felt with time running out, remaining with the known knowns was more prudent.

Having said all that, it's not a done deal of course. If Fidelity don't open my IRA in time e.g. stuff lost in the mail, or I fail to transfer funds from my 401(k) in time (which may need the assistance of my ex-company's plan administrator) then by default I assume my 401(k) will be moved along with everyone else's.

If anyone has experience of rolling over and knows the exact process with regard to the transfer of funds I'd be glad to hear it. All the IRA application form says is
"Initiate your plan distribution by calling your plan’s toll-free number. Request and complete any required distribution forms from your plan and follow the appropriate processing instructions that they provide."
I've had enough for one day, so that phone call will have to wait. I assume I need to wait until the IRA is open before initiating my plan distribution - but maybe not.
bhradbh
Posts: 65
Joined: Thu Mar 16, 2017 2:22 pm

Re: Move 401(k) or Rollover to IRA

Post by bhradbh »

mrploppy,

Re: via Royal Mail International Tracked and Signed

I have recently sent numerous mail items to the US with Tacked and Signed service, after a while every item had just got stuck at a local to delivery address USPS office and has remained there ever since.

I have successfully had other mail items delivered to the same addresses using the Royal Mail International Tracked service. To be clear that is the tracked service without signature.

Just an FYI for future reference.
Topic Author
mrploppy
Posts: 80
Joined: Thu May 04, 2017 5:20 pm

Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

bhradbh wrote: Wed Apr 07, 2021 4:08 pm mrploppy,

Re: via Royal Mail International Tracked and Signed

I have recently sent numerous mail items to the US with Tacked and Signed service, after a while every item had just got stuck at a local to delivery address USPS office and has remained there ever since.

I have successfully had other mail items delivered to the same addresses using the Royal Mail International Tracked service. To be clear that is the tracked service without signature.

Just an FYI for future reference.
That's depressing to hear. Fingers crossed.

Out of curiosity, what do you do when that happens? Is there any chance of getting your item "unstuck"? Or do you just send again?
bhradbh
Posts: 65
Joined: Thu Mar 16, 2017 2:22 pm

Re: Move 401(k) or Rollover to IRA

Post by bhradbh »

I just cut my losses and resent without the signature requirement.
TedSwippet
Posts: 5166
Joined: Mon Jun 04, 2007 4:19 pm
Location: UK

Re: Move 401(k) or Rollover to IRA

Post by TedSwippet »

bhradbh wrote: Wed Apr 07, 2021 4:49 pm I just cut my losses and resent without the signature requirement.
When this happened to me, I queried it with the Post Office. After investigating, they refunded my full postage costs.

Even better, the items (this has happened more than once) all arrived at their destination and in good time anyway. It was just that the far end -- presumably the good old USPS -- failed to keep to their signature part of the bargain (repeatedly). Free postage for me, then. Result!
Topic Author
mrploppy
Posts: 80
Joined: Thu May 04, 2017 5:20 pm

Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

TedSwippet wrote: Wed Apr 07, 2021 4:57 pm
bhradbh wrote: Wed Apr 07, 2021 4:49 pm I just cut my losses and resent without the signature requirement.
When this happened to me, I queried it with the Post Office. After investigating, they refunded my full postage costs.

Even better, the items (this has happened more than once) all arrived at their destination and in good time anyway. It was just that the far end -- presumably the good old USPS -- failed to keep to their signature part of the bargain (repeatedly). Free postage for me, then. Result!
Good to hear that your items arrived! TBH, I'm not sure why I chose Tracked and Signed - maybe I thought it was analogous to belt and braces. In reality, I don't suppose the signature is useful. It's not as if you could point the finger at that person - who's probably someone working for minimum wage in a mailroom. What's more important is that you know it's been delivered to its final destination. Ah well, lesson learned I suppose.

Exciting times though - it's on its way to Heathrow!
bhradbh
Posts: 65
Joined: Thu Mar 16, 2017 2:22 pm

Re: Move 401(k) or Rollover to IRA

Post by bhradbh »

Very exiting. Gets to Heathrow in a day, handed over to USPS and then hurry up and wait.
Topic Author
mrploppy
Posts: 80
Joined: Thu May 04, 2017 5:20 pm

Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

Just been in touch with Fidelity. They said that the "regular mail" address, which is a PO Box, is generally for mail that doesn't require a signature. The "overnight" mail address, which is a proper mail address, is where they normally receive their "signed for" mail - like FedEx, UPS and all those other excellent services you get in the US. So I can imagine that mail requiring a signature could get stuck with a PO Box address.

To that end, and with my rather tight timescale, I intend sending my paperwork again tomorrow - tracked but not requiring a signature - to the regular mail address. My first attempt was tracked and signed to their regular mail address. It can't hurt, and I can't afford to wait to work out whether my application is stuck in a USPS delivery depot. Plus it's only a tenner.

Fidelity say that receiving the paperwork twice wouldn't be an issue - but I've included a note anyway. Now it's even more exciting - how many, if any, will reach their destination, and if both do which one will get there first. I can hardly contain myself!
TedSwippet
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Re: Move 401(k) or Rollover to IRA

Post by TedSwippet »

mrploppy wrote: Thu Apr 08, 2021 1:55 pm It can't hurt, and I can't afford to wait to work out whether my application is stuck in a USPS delivery depot. Plus it's only a tenner.
Really? That much? I'm clearly out of touch.

I gave up with all of these confirmation and signed-for things some time ago, having become entirely convinced that you never, ever get any delivery confirmation back from the US. Nowadays, I just use regular air mail when email or secure message is not an option. So far, nothing has ever got lost or mislaid, and things seem to sometimes arrive scarily quickly. For cases where you can tell, that is -- this would of course exclude the IRS, who will sit on incoming mail for months if it does not include a cheque.

A side question ... do you have any regrets over your choice of forum username? :-)
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mrploppy
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Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

TedSwippet wrote: Thu Apr 08, 2021 2:11 pm
mrploppy wrote: Thu Apr 08, 2021 1:55 pm It can't hurt, and I can't afford to wait to work out whether my application is stuck in a USPS delivery depot. Plus it's only a tenner.
Really? That much? I'm clearly out of touch.

I gave up with all of these confirmation and signed-for things some time ago, having become entirely convinced that you never, ever get any delivery confirmation back from the US. Nowadays, I just use regular air mail when email or secure message is not an option. So far, nothing has ever got lost or mislaid, and things seem to sometimes arrive scarily quickly. For cases where you can tell, that is -- this would of course exclude the IRS, who will sit on incoming mail for months if it does not include a cheque.

A side question ... do you have any regrets over your choice of forum username? :-)
The signed option does seem a bit daft in retrospect. I read on the RM's website earlier that there's no way to get a copy of the signature anyway, so you couldn't identify who'd handled your mail. As far as mail going missing we've had bad experiences. When we lived abroad, relatives once sent money in an envelope (stupid idea I know) for our sons' birthdays. Apparently, it was delivered (to someone) and we never saw the money. RM did reimburse some of it if I remember. A couple of times in the last few years we've sent small parcels to Europe and they've never arrived. Maybe we're just unlucky.

As far as my username - you're the first to even mention it! I started using it when we lived in the USA. The locals were ever-so amused but they didn't know the Blackadder reference, of course. It was a cunning plan.
bhradbh
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Re: Move 401(k) or Rollover to IRA

Post by bhradbh »

TedSwippet wrote: Thu Apr 08, 2021 2:11 pm Nowadays, I just use regular air mail when email or secure message is not an option. So far, nothing has ever got lost or mislaid, and things seem to sometimes arrive scarily quickly. For cases where you can tell, that is -- this would of course exclude the IRS, who will sit on incoming mail for months if it does not include a cheque.
You may have something here. Now I think about it, when sending regular correspondence or even Christmas cards etc. via 1st class air mail it is usually received within a week of post mark date.
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mrploppy
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Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

So while we're waiting for the excitement to unfold, I have a question re sending packages to the USA (or anywhere else international for that matter) via courier e.g. UPS, DHL, FedEx. This possibly deserves its own thread on a completely different forum, but I thought maybe some of you have tried it. BTW, I'm assuming that the companies I mentioned would be quicker than regular mail via Royal Mail/USPS. They should be for the amount they charge.

If you've ever tried sending internationally using one of these companies you'll know, when filling in the recipient's details on their website, that they insist on a contact name. I'm amazed that this is the case. If you're sending to a large company like Fidelity Investments, the contact name is irrelevant surely (Shirley?). They're so big that different departments have different zip codes (I think) - and it only matters that it gets to the correct department.

Anyone had fun with this? And if so, what did you do to get around it?
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mrploppy
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Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

In the absence of any real news ... the latest updates on my two packages, both addressed to Fidelity's PO Box address in Cincinnati, OH. And maybe some useful info for anyone sending mail to the USA at the moment. Remember, both packages have the same contents, except one was sent "tracked" and the other "tracked and signed". FYI, the latter was 10p more expensive.

Package 1: Tracked and Signed. Royal Mailed on 7th April. Cleared ISC Chicago on 15th April. No estimated delivery date yet.

Package 2: Tracked. Royal Mailed on 9th April. Cleared ISC New York on 14th April. Estimated delivery 19th April.

So, if you were a betting person, what do you think the odds are of getting one of these packages to their ultimate destination (somewhere beyond the PO Box, I assume) in time so that an IRA can be opened and 401(k) funds transferred before April 29th? It's going to be tight I think. And sadly, I don't see any option but wait and see. If it doesn't happen, my 401(k) will be transferred to its new provider.

I will call Fidelity once I know the first (winner) package has been delivered. In the meantime, for anyone who has rolled over a 401(k) to an IRA, what exactly is the process for transferring the funds? Does it happen automatically on opening the IRA (presumably not because isn't it possible to move some or all of the 401(k) to the IRA?)? Or does it require more paperwork to transfer the funds? I'm hoping it's just a case of making a phone call.
TedSwippet
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Re: Move 401(k) or Rollover to IRA

Post by TedSwippet »

mrploppy wrote: Thu Apr 15, 2021 1:24 pm So, if you were a betting person, what do you think the odds are of getting one of these packages to their ultimate destination (somewhere beyond the PO Box, I assume) in time so that an IRA can be opened and 401(k) funds transferred before April 29th?
Not a betting person, but if I were, my guess is that both packages will arrive at Fidelity before April 29th. Admittedly, this is based on experiences of USPS before both the pandemic and their additional self-inflicted crisis, so I suppose reality rather depends on just how much degradation from these two remains.
mrploppy wrote: Thu Apr 15, 2021 1:24 pm I will call Fidelity once I know the first (winner) package has been delivered. In the meantime, for anyone who has rolled over a 401(k) to an IRA, what exactly is the process for transferring the funds? Does it happen automatically on opening the IRA (presumably not because isn't it possible to move some or all of the 401(k) to the IRA?)? Or does it require more paperwork to transfer the funds? I'm hoping it's just a case of making a phone call.
It totally depends. For a rollover between different brokers life can become complex -- checks in the mail(*), taxes withheld, and so on -- but for a rollover with the same provider on both ends, life should be much simpler.

What information did you provide in the paperwork you sent off? For me, Vanguard used an all-in-one form to both open my new Roth IRA and also specify which bits of my 401k to rollover, and into what. Maybe Fidelity operates differently; perhaps easier, perhaps not.


(*) In 2008, I rolled my Vanguard IRA into my Vanguard 401k (why? ... it's a long story). Vanguard were all set to sell my IRA funds, cut a check made out to me (but FBO Vanguard), and mail it cross-country to me, so that I could then put it in one of their pre-paid envelopes and send it cross-country again right back to them for deposit in my 401k. It took a bit of pushing to convince them of the absurdity. In the end, they agreed to instead just handle everything through their internal mail, so long as I provided a suitable 'letter of instruction', hard copy and wet signature. It worked, but you have to wonder why their default process wasn't a lot smoother. Perhaps things have improved since. Perhaps.

And as it happens, I still have a $50 stub tIRA from the above rollover that remains at Vanguard. I have been meaning to clear it out. But, given your experience, I'm going to keep it. If my ex-employer decides to act as yours, and change 401k provider at short notice, I could be very relieved to have this IRA already open and ready for action.
Last edited by TedSwippet on Thu Apr 15, 2021 3:35 pm, edited 1 time in total.
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mrploppy
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Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

TedSwippet wrote: Thu Apr 15, 2021 2:58 pm Not a betting person, but if I were, my guess is that both packages will arrive at Fidelity before April 29th.
I don't know if I'm being over-optimistic but, fingers crossed, I think they'll both arrive early next week. It would then just be a question of delays in moving paperwork around within the Fidelity organisation, which I imagine is quite large.
TedSwippet wrote: Thu Apr 15, 2021 2:58 pm It totally depends. For a rollover between different brokers life can become complex -- checks in the mail(*), taxes withheld, and so on -- but for a rollover with the same provider on both ends, life should be much simpler.
Yes, you'd hope so.
TedSwippet wrote: Thu Apr 15, 2021 2:58 pm What information did you provide in the paperwork you sent off? For me, Vanguard used an all-in-one form to both open my new Roth IRA and also specify which bits of my 401k to rollover, and into what. Maybe Fidelity operates differently; perhaps easier, perhaps not.
The form they emailed me to submit was just an Internal Rollover To IRA form, for people who already have a 401(k) with them. Strangely though, the form didn't ask for any 401(k) details, like the plan number or how much I want to rollover, but they'd be able to join the dots if they tried hard enough - using my SSN etc. I don't suppose that's enough though, because presumably I could have more than one 401(k) with them (I assume that's possible) and they'd have to know which one I meant. Or if they're clever, they'll realise I only have one 401(k) so it has to be that one. They also didn't ask which fund I want the money to rollover into.

My covering letter goes into the detail they need - 401(k) plan number, etc - and outlines the urgency of the situation, but whether that helps, and whether it remains attached to the form, with all the extra stuff (passport photo, W-8BEN, trusted contacts form) remains to be seen. Vanguard seem to have it sorted, if their form is anything to go by.
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mrploppy
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Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

Just a quick update for those interested in the performance of Royal Mail/USPS. My second package, sent from my local post office on 9th April, was delivered today (22nd April). Hopefully, there is enough time to get rolled over before the 29th.

FYI, my first package, sent from my local post office on 7th April is still stuck in Chicago, and has been there since 15th April. Methinks it's effectively lost, but can't claim until the middle of May. Assuming it is lost it does bring up the issue of needing to send paper documents and the security thereof. There is now an envelope of papers that have my signature, SSN, date of birth, phone number, address, 401(k) plan number, passport photo, and more, sitting somewhere in Chicago. It's an identity fraudster's dream. And yet, they won't accept documents that have been uploaded electronically. It's nuts.
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mrploppy
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Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

Rollover to IRA complete - it was tight but Fidelity were very good to rush it through in the end, despite wanting paper copies of everything with "wet signatures". I still don't get the obsession. The remaining challenges now begin - making sure they process the W-8BEN that accompanied my rollover application, setting up US bank details (which they could easily have copied over from my 401(k), but hey ho), and trying to arrange automatic periodic withdrawals (ideally without tax withheld). Interestingly, there is mention of foreign currency in my IRA account (online), so whether that means that withdrawals can be made electronically to a foreign bank, we'll see. Having said that, I've been very happy having my withdrawals EFT'ed to my US bank and then using (Transfer)Wise to send them to the UK.

FYI, one of my packages (the first I sent) is still stuck in Chicago. It's been 20 days since I sent it, 12 of those days spent in Chicago.
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Re: Move 401(k) or Rollover to IRA

Post by TedSwippet »

mrploppy wrote: Tue Apr 27, 2021 7:25 am Rollover to IRA complete - it was tight but Fidelity were very good to rush it through in the end, despite wanting paper copies of everything with "wet signatures". I still don't get the obsession.
Good news indeed. As for the paper thing, it might be CYA around IRS rules, regs, or whatever. It seems that US banks and brokerages work on some sort of default assumption that any instruction coming from abroad via the internet is more likely to be fraudulent than one coming from inside the US.
mrploppy wrote: Tue Apr 27, 2021 7:25 am The remaining challenges now begin - making sure they process the W-8BEN that accompanied my rollover application, setting up US bank details (which they could easily have copied over from my 401(k), but hey ho), and trying to arrange automatic periodic withdrawals (ideally without tax withheld). Interestingly, there is mention of foreign currency in my IRA account (online), so whether that means that withdrawals can be made electronically to a foreign bank, we'll see. Having said that, I've been very happy having my withdrawals EFT'ed to my US bank and then using (Transfer)Wise to send them to the UK.
That's a battle you've already won with them, so hopefully this time around should be easier. At any roadblocks you can readily point them to their own 'prior art'. Don't know anything about the foreign currency option -- don't think Vanguard has this (or if it does, I've never found it). Could be worth a look, although the chances of it beating (Transfer)Wise are perhaps slim.
mrploppy wrote: Tue Apr 27, 2021 7:25 am FYI, one of my packages (the first I sent) is still stuck in Chicago. It's been 20 days since I sent it, 12 of those days spent in Chicago.
My money is on it having already been delivered, and just the tracking that hasn't been correctly updated. Could be wrong, of course. (And at this point you'll be holding out for the tracking to not get updated for a week or two more, so you can get a refund on postage!)

Glad to hear you got this sorted out, anyway. I assume Fidelity had no plan for how to proceed if your snail-mail paperwork failed to reach them in time, despite the entire process being outside your control. It's easy to imagine a scenario where the notice period you get for something like this is shorter than the minimum paperwork turnround time to handle it.
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mrploppy
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Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

TedSwippet wrote: Tue Apr 27, 2021 12:04 pm That's a battle you've already won with them, so hopefully this time around should be easier. At any roadblocks you can readily point them to their own 'prior art'.
I would hope so. Although I have a sneaky suspicion that the IRA and 401(k) people are pretty separate, you'd expect the tax people in the "back office" - who I've never been able to speak to directly, only by letter - would be the same.
TedSwippet wrote: Tue Apr 27, 2021 12:04 pm My money is on it having already been delivered, and just the tracking that hasn't been correctly updated. Could be wrong, of course. (And at this point you'll be holding out for the tracking to not get updated for a week or two more, so you can get a refund on postage!)
Ideally, I'd like it to have been delivered already, so that there's not a bunch of my important paperwork is a US Post Office somewhere. But the chance of £10 refund ... tough one!
TedSwippet wrote: Tue Apr 27, 2021 12:04 pm Glad to hear you got this sorted out, anyway. I assume Fidelity had no plan for how to proceed if your snail-mail paperwork failed to reach them in time, despite the entire process being outside your control. It's easy to imagine a scenario where the notice period you get for something like this is shorter than the minimum paperwork turnround time to handle it.
I'm pretty sure they had no contingency plan. They told me more than once that they had to have paper forms with proper signatures. In fairness, they were very good at turning it around once they received the paperwork. By that time I'd found a point of contact - an actual name of an actual person who I could communicate with by email! - who was very keen to get it done and took care of expediting the process. I'd been told informally that it normally takes 7-10 business days to process an account application. In the event, I received a phone call late on Friday evening (actually very late on Friday evening) - that's one day after the paperwork was delivered - to complete the account opening and rollover process. I was impressed with that. As regards your last point - indeed. For that reason I think I made the right decision in the end.
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mrploppy
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Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

Mail update: package 2, which started out as package 1, delivered. Good news - in that there's not a bunch of personal information sitting somewhere, ripe for identity fraud. Bad news - in that I can't claim for a lost package. It "only" took 24 days in total - which obviously missed the deadline. I am so very glad that I decided to send a second package - the one that arrived before the deadline. I don't suppose there's any way to know whether Tracked And Signed was responsible for the delay on the first package, although it wasn't the signature at the delivery point that was the hold-up. It was stuck in Chicago for a long time - maybe in customs.

Other challenges await.
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Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

Well, the bad news is that I've failed to get automatic periodic withdrawals set up from my IRA. They are not allowed for NRAs. The rules for distributions from 401(k) and IRA are different, apparently (but no specifics), so no "prior-art" argument. So, I'll need to call up to make each withdrawal.

While they will respect the 0% withholding, as per the tax treaty and W-8BEN, this "can't be applied pre-emptively" - an interesting choice of words. However, I will be able to claim a refund directly from Fidelity (at some point as yet undefined - presumably before they give that money to the IRS). I'm guessing that requires another phone call. Not clear yet where the refund goes - I doubt it'll go back into the IRA without me doing something. I notice that I automatically have a cash account alongside the IRA, so maybe it goes there. It may be that they're using their definition of lump-sum again (which they gave me in writing some time ago), which is the withdrawal of all funds in one tax year. Using their definition, they can't tell if all funds have been withdrawn until the end of the year. I can see that argument ... but then, it didn't apply to my 401(k), so it's all a bit mysterious.

Depending on the answers to these questions, I may be just as well claiming the tax back from the IRS. At least the IRS will pay it directly into my US bank account - and that's where I wanted it to end up in the first place (albeit about a year earlier). But as we know, I'm likely going to have to pay UK tax on my withdrawals before getting the refund from the IRS. We'll see.

A disappointing outcome to say the least, especially as I'd been given assurances to the contrary. Yet another example of "don't believe what they tell you on the phone", even if they tell you more than once and you hear it from different people. Still better the devil you know, though, perhaps.

Any suggestions, strategies, "I told you so's", wise words, etc greatly appreciated.
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Re: Move 401(k) or Rollover to IRA

Post by TedSwippet »

mrploppy wrote: Wed May 19, 2021 3:19 pm Well, the bad news is that I've failed to get automatic periodic withdrawals set up from my IRA. They are not allowed for NRAs. The rules for distributions from 401(k) and IRA are different, apparently (but no specifics), so no "prior-art" argument. So, I'll need to call up to make each withdrawal.
And yet, the IRS rules for tax withholding, treaty claims, and so on on retirement account withdrawals for NRAs are, as far as I've seen, entirely agnostic on whether the account is an IRA or a 401k. Or for that matter, any other form of this thing -- 403b, 457, and so on.

Vanguard's 401k department is fairly separate from the rest of its operations, so thing can look different for 401ks and for other accounts; maybe Fidelity does something similar. Even so, the rules around NRA withdrawals is the same, so Fidelity look to have completely invented this restriction for themselves. Wouldn't be the first time; won't be the last. Still, disappointing, as you say.
mrploppy wrote: Wed May 19, 2021 3:19 pm While they will respect the 0% withholding, as per the tax treaty and W-8BEN, this "can't be applied pre-emptively" - an interesting choice of words. However, I will be able to claim a refund directly from Fidelity (at some point as yet undefined - presumably before they give that money to the IRS). I'm guessing that requires another phone call. Not clear yet where the refund goes - I doubt it'll go back into the IRA without me doing something. I notice that I automatically have a cash account alongside the IRA, so maybe it goes there. It may be that they're using their definition of lump-sum again (which they gave me in writing some time ago), which is the withdrawal of all funds in one tax year. Using their definition, they can't tell if all funds have been withdrawn until the end of the year. I can see that argument ... but then, it didn't apply to my 401(k), so it's all a bit mysterious.
Totally mysterious. Never seen this before. If they are 'refunding' tax withholding -- whatever that means within the context of Fidelity's opaque systems here -- then the refund will almost certainly go into your cash account, not back into the IRA. Putting it back there would effectively be a new IRA contribution, and then taxable again when withdrawn, so very much not what you want to happen.

I suppose this could be wrapped up in 'lump sum' definition, but I'd say it's more likely that Fidelity has a crappy system for payments to NRAs that always withholds some tax because it's badly programmed, so that they have to go around in some later batch process and unwind these withholdings by some form of 'refund'. Complete guesswork, of course.

Overall, I'd say you're better off getting the Fidelity refund than claiming back from the IRS. Less paperwork, and (probably) less delay. Once you start withdrawals from your IRA, you can have those go into your cash account. Set up a route from that to your UK bank -- perhaps (Transfer)Wise or Revolut -- and you're good to go for both withdrawals and any subsequent withholding 'refunds'. That's more or less what I have in place with Vanguard.
mrploppy wrote: Wed May 19, 2021 3:19 pm A disappointing outcome to say the least, especially as I'd been given assurances to the contrary. Yet another example of "don't believe what they tell you on the phone", even if they tell you more than once and you hear it from different people.
Probably the most frustrating aspect. It seems that no matter how much time and effort you expend making sure that a US financial provider will do the right thing before you take an irreversible action, they are likely to renege later.
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mrploppy
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Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

Just had an update from Fidelity. It's all been a bit chaotic TBH. They sometimes feel compelled to send me stuff by regular mail, even when I've submitted a question via secure message. So a few days ago I received a copy, in the mail, of the automatic withdrawal request I'd submitted by secure message (because I'd failed to state which fund I wanted withdrawals to be taken from - even though I only have one fund). However, I'd dealt with that problem by secure message, so was done and dusted as far as I was concerned - albeit that the request was denied. Regardless, I thought I'd better check (by secure message again) that I didn't need to do anything with this paper form that I'd received. These messages/mails are like ships passing in the night.

I've just now received an answer to that question. I've asked a question since then regarding refunds of tax but had no response yet. This latest message I've received apologised for the frustration, but that they had been able to make an exception for me and that they won't withhold tax from my withdrawals. But I still need to call up to initiate them because I'm not allowed to have a withdrawal plan.

It's really quite frustrating when messages back and fore overlap. A different person seems to answer my questions every time. I can only hope they're all following the thread of messages/letters that have been sent/received during the last few weeks. At least I now have a message in black and white (I should take a screenshot) which they can't deny and which you'd hope they'll honour.

Anyway, I think that's good news. It almost makes me want to call up and make a withdrawal just to test it out!

Obviously, I'm still expecting an answer to the refunds question I asked yesterday (that'll probably arrive tomorrow) - although that question may now be moot. Phew!
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mrploppy
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Re: Move 401(k) or Rollover to IRA

Post by mrploppy »

So, you want to hear how this played out in practice?

It's June, time to make my very first withdrawal from my brand spanking new IRA. I call up. Fearing the worst I request a small-ish withdrawal - $5K - just as a proof-of-concept. We talk about the previous discussions I've had regarding tax withholding and I point him to secure messages I've received saying that they won't withhold any tax. He arranges the withdrawal and it'll go straight to my US bank account. Excellent.

Not so fast, Batman. Following day I get a phone call from the very same rep, saying that they have to withhold tax. I point him again to messages I've received, and he goes away and thinks about it. He calls me back. Sure - they won't withhold tax, but it has to happen like this:
1. They initiate a trade to withdraw the full amount.
2. 70% of it can be transferred directly to my bank.
3. 30% has to be withheld for tax.
4. That 30% goes somewhere - I suspect to a holding bank before it goes to the IRS at some point.
5. They issue a tax withholding correction to get that 30% back.
6. That money eventually re-appears in my IRA account - as cash.
7. I can then have that 30% (but more later).

This all takes quite a long time and a couple of phone calls and some secure messages along the way.

The 70% arrived in my bank account after 6 days. The remainder was a bit of a mystery. Nothing seemed to be happening so I checked - whereupon I was told that the refund was on its way and would be credited today. Then I could call up to request a withdrawal of that refund. What? Another phone call? Sure enough the money re-appeared in my IRA account - this after after 8 days.

I called up again. I had this awful feeling that this refund withdrawal would again be subject to tax withholding, tax correction, etc, and we'd end up in this (almost) infinite loop where we'd be talking about smaller and smaller amounts until eventually we'd tend to zero. Anyway, this phone call took 45mins. The upshot is that it's not taxable (again), and that in future the last step, where the previously withheld tax is sent to my bank account, will (should) happen automatically. By tomorrow, or the day after, I should have the full withdrawal amount in my US bank account (for me to then send to the UK). Nine or ten days in total.

The whole process was quite painful, but I half expected it. Hopefully future withdrawals will be easier, although I will still have to call up to initiate them. I can't imagine doing this every month so I am minded in future to withdraw quarterly, or something like that.

Thanks for listening. Hopefully, this may help someone who has to go through the same process. I'm off for a lie down.
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