Retirement Income

The distribution and conversion mechanics live in chapter “Tax Advantaged Accounts” and chapter “Tax-Efficient Decumulation”; this section covers only the reporting that trips people. One decision deserves a pointer here because it is irreversible and tax-driven: employer stock inside a 401(k) can leave the plan under the net-unrealized-appreciation rule, paying ordinary tax on the plan’s cost basis and long-term capital-gains tax on the appreciation, but only if the whole account is distributed in one year and the shares come out in kind — section “Net Unrealized Appreciation: The One-Shot Decision at Separation”.