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Military Tax Benefit: Rolling SGLI Proceeds to a Roth IRA Thumbnail

Military Tax Benefit: Rolling SGLI Proceeds to a Roth IRA

Taxes Videos

 Welcome to Curt's Chalk Talk. I'm Curt Sheldon with C.L. Sheldon & Company. And today I'd like to talk to you about one of your tax benefits. Now, to be honest, I hope it's one you never have to use or anyone that you know has to use, but you need be aware of but it could be important if someone does need it. 

It has to do with SGLI, your military death gratuity, and a Roth IRA. Now on a very special cutout in the tax law, no one other than military members can do this. If the military member dies while on active duty, SGLI proceeds and the death gratuity which could total up to $500,000 can be deposited into a Roth IRA and be considered a rollover. 

In other words, the surviving spouse can put $500,000, directly into Roth IRA and be really set up for life. Now, even if the spouse needs that money before reaching retirement age the first $500,000 to come out would be tax-free because it's the roll over contribution. This is a really important benefit and it could really help someone if they need it someday. So please remember. 

Are you getting ready to transition from the military either through retirement or separation? Well we've got a checklist to help you out and oh, by the way, it's free. You can get it at www.clsheldon.com/tax. That's www.clsheldon.com/tax.

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