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Rollover IRA

 
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IRA Rollover - Option 2

Option #2: Receive the distribution in a check made payable to you.

If you choose to have your retirement plan benefits paid to you, consider the following:

  • Your distribution will be subject to a 20% mandatory withholding tax, which means you will receive only 80% of your retirement savings.
  • Your distribution will be subject to federal income tax in the year received unless you roll it over within 60 days of receiving your check.
  • You can roll over 100% of the distribution eligible for rollover treatment by replacing the 20% that was withheld with money from your other savings. You will receive credit for the 20% withheld when you file your federal income tax return for that year.
  • If you only roll over the 80% of your distribution that you received, the 20% withheld will be considered taxable income and will be subject to current federal income taxes and a possible 10% early withdrawal penalty. Depending on where you live, state and local taxes may apply as well.

How can you avoid paying unnecessary taxes and penalties?

Consider a Northern Funds Rollover IRA or have your money transferred directly to your new employer's qualified plan.

Direct Rollover Advantages

  • Your money can continue to grow tax-deferred until withdrawn
  • Avoids 20% mandatory withholding tax
  • Avoids 10% early withdrawal penalty

Option #1: Request a direct rollover into a Rollover IRA.

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Not FDIC insured | May lose value | No bank guarantee

You could lose money by investing in the Money Market Funds. Although each of the Money Market Funds seeks to preserve the value of your investment at $1.00 per share, it cannot guarantee it will do so. The Funds’ sponsor has no legal obligation to provide financial support to the Funds, and you should not expect that the sponsor will provide financial support to the Funds at any time.

The Money Market Fund and the Municipal Money Market Fund may impose a fee upon the sale of your shares or may temporarily suspend your ability to sell shares if the Fund’s liquidity falls below required minimums because of market conditions or other factors.

An investment in a Fund is not a deposit of a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation (“FDIC”), any other government agency, or The Northern Trust Company, its affiliates, subsidiaries or any other bank.

Please carefully read the summary prospectus or prospectus and consider the investment objectives, risks, charges and expenses of Northern Funds before investing. Call 800-595-9111 to obtain a summary prospectus or prospectus. The summary prospectus and prospectus contain this and other information about the Funds.

Shares of the Northern Funds are offered only by a current Prospectus and are intended solely for persons to whom shares of US registered funds may be sold. This site shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of shares of the Northern Funds in any jurisdiction in which such offer, solicitation or sale would be unlawful.

©2018 Northern Funds | Northern Funds are distributed by Northern Funds Distributors, LLC, not affiliated with Northern Trust.