Recently, I checked the website of the last 401(k) plan that I contributed. I found that the account was "forfeited", which I assume it means that it was closed due to not being an employee of the company anymore and because there was no contributions for more than a year.
I received a check with the money that was on the account (around $1,000). My question is: can I open an Roth IRA to put this money in order to avoid the 20% penalty, or it is too late to avoid the penalty?
Something to note is that I will be able to contribute to an 401(k) plan again in a few months, so my idea is to put the money on the Roth IRA, and rollover it later to the 401(k) plan. Of course, if I need to pay the penalty no matter what, I prefer to keep the money and pay some of my debts.