Rollovers into IRAs

Rollovers into IRAs are important for all involved parties - the individual, the IRA custodian/trustee and the 401(k) plans. Rollovers are a tax subject and so certain rules must be met or the expected/desired tax benefits will not be realized. Rollover situations require the individual to make tax and financial planning decisions. 4.9 million taxpayers made a rollover contribution to one or more of the four types of IRAs.

  • 4.5 million made a rollover contribution to a traditional IRA.
  • 341,629 made a rollover contribution to a Roth IRA.
  • 51,668 made a rollover contribution to a SEP-IRA.
  • 6,647 made a rollover contribution to a SIMPLE IRA.
  • 434.8 billion dollars were rolled over into one of the four types of IRAs .
  • 423.9 billion dollars were rolled over into a traditional IRA or $91,489 per person.
  • 6.7 billion dollars were rolled over into Roth IRAs or $19,567 per person
  • 4.8 billion dollars were rolled over into SEP-IRAs or $93,232 per person.
  • .4 billion dollars were rolled over into SIMPLE-IRAS or $58,195 per person

Rollover Chart summary:

Size of AGI
Number of Taxpayers
Rollover Amount
Average
No MAGI
41,067
$2,788,340,000
$67,897
$1 - $19,999
382,977
$15,803,165,000
$41,264
$20,000 - $29,000
279,289
$10,860,978,000
$38,888
$30,000 - $39,000
282,980
$11,251,524,000
$39,761
$40,000 - $49,000
292,484
$11,809,385,000
$40,376
$50,000 - $74,000
732,203
$43,073,467,000
$58,827
$75,000 - $99,000
728,878
$54,396,582,000
$74,631
$100 M - $199,000
1,408,048
$144,447,514,000
$102,487
$200 M - $499,000
585,931
$100,812,445,000
$172,055
$500 M - $999,999
92,157
$23,904,227,000
$259,386
$1,000,000 or more
45,178
$15,666,997,000
$346,784
Totals
4,871,192
$434,814,624,000
$89,262


CWF Observations

  1. Rollovers of $424 billion were made in 2014 into traditional IRAs.
  2. 4.9 million taxpayers made a rollover.
  3. The average rollover of all taxpayers was $89,262.
  4. The average rollover of taxpayers with MAGI of less than $40,000 was $40,174, but those taxpayers with no MAGI were excluded.
  5. Taxpayers with MAGI between $100,000 - $200,000 rolled over $144 billion or an average of $102,587.
  6. Taxpayers with MAGI above $200,000 had rollovers averaging $194,097.
  7. Taxpayers with MAGI exceeding $1,000,000 had rollovers averaging $346,784.

Annual IRA Contributions for 2014 - Traditional, SEP, SIMPLE, and Roth

  • 155.5 million individuals were eligible to make one or more of the four types of IRA contributions (155,481,151).
  • 12.8 million taxpayers made/received one or more of the contribution types.
  • 6.3 million made a Roth IRA contribution.
  • 4.3 million made a Traditional IRA contribution.
  • 1.7 million made a SIMPLE IRA contribution.
  • 1.1 million made a SEP-IRA contribution.
  • 62.7 billion ($62,745,693,000) was contributed to IRAs in 2014.
  • 21.9 billion to Roth IRAs ($21,868,086,000) or $3,470 per person.
  • 17.5 billion contributed to Traditional IRAs ($17,515,419,000) or $4,073 per person.
  • 14.6 billion contributed to SEP-IRAs ($14,566,424,000) or $13,349 per person.
  • 8.8 billion contributed to SIMPLE IRAs ($8,800,764,000) or $8,065 per person.


CWF Observations

  1. Roth IRAs lead - largest number of contributor and largest amount contributed. Traditional IRAs are second both in number and contributions and by amount.
  2. SEP-IRAs have the fewest number of contributors, but the amount of contributions of 14.6 billion is a close third to the 17.5 billion being contributed to SIMPLE IRAs.
  3. IRAs are being under-used. Annual IRA contributions are being made only 8.3% (12.8 million out of 155.5 million taxpayers) who are eligibles to make an IRA contribution. People are missing opportunities to make IRA contributions. Higherincome individuals need to be informed why it is in their best interest to make non-deductible traditional IRA contributions and why it is well worth their time and effort to do so.