The purpose of the 401(k) Net Unrealized Appreciation vs. Rollover calculator is to examine the possible tax benefits of transferring your 401(k) investments to a taxable account. To use this tool you will need to enter the balance of your 401(k) at the time of the distribution, the total stock purchased using cost basis, the current rate of return on your investments, holding period years, holding period months, capital gains rate, and marginal income tax rate. You will also need to disclose if you "separated from service at age 55 old or older," if your "initial distribution will be at age 59 ½ or older," and if "your final distribution will be at age 59 ½ or older." This calculator will run these figures and show you your total immediate taxes and total future taxes for each investment scenario.

401(k) Net Unrealized Appreciation Calculator Overview

Effective retirement planning requires both smart investments and strategic distribution of your funds. If you fail to take both of these factors into consideration you will reduce the amount of money that you will be able to earn for retirement and you will also end up spending more money then you have to in taxes and fees. For example, in some cases you can save a great deal of money on federal taxes if your transfer your 401(k) funds to a taxable investment account. If you qualify, you may only have to pay capital gains taxes on your investments, which is around 15 percent, instead of your normal marginal income tax rate or around 25 percent. If you would like to examine the potential tax benefits of rolling over your 401(k) account into a taxable investment account then you should use our 401(k) Net Unrealized Appreciation vs. Rollover Calculator.