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My wife has already maxed out a Roth IRA for 2010. She just quit her job, and has a 401k from her former employer. Would I be able to roll it into a new Roth IRA even though she has already contributed the maximum for 2010. Do the contribution limits apply to rollovers?

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You'll want to roll the 401k over to a specifically designated rollover IRA. Rollover IRAs differ from an ordinary IRA account because they have NO contribution limit per year.

Also Rolling over a 401k to a Roth IRA has consequences. There won't be a penalty but you will have to pay taxes on the amount being rolled over.

The choice of Roth or Traditional IRA depends on your current tax situation as well as your expected taxes at retirement. Typically if you are in a low tax bracket and expect to be in a higher tax bracket at retirement a Roth IRA is suggested as withdrawals are tax free. With a rollover conversion you will have to evaluate whether paying taxes now outweighs the potential benefits of tax free withdrawals when you retire.

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"Rollover IRAs differ from an ordinary IRA account because they have NO contribution limit per year." This is completely wrong and makes no sense. A so-called "Rollover IRA" is no different from a Traditional IRA (or Roth IRA). Period. It is simply a designation for where the money came from. Rollovers are not contributions, so obviously rollovers have no relation to the contribution limits. –  user102008 Jan 8 '13 at 2:30
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You can't rollover a 401k directly into a Roth IRA. What you can do is rollover a 401k into a traditional IRA, and then convert some or all of the money to a Roth IRA. This is independent of any contributions made to a traditional or Roth IRA.

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You can in many IRAs. The effect is the same. –  user102008 Jan 8 '13 at 2:31
    
Not necessarily. There have been some changes recently that allow rollover to Roth IRA possible. –  Vasu Apr 19 '13 at 13:36
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