I quit my job at the helium gas factory. I refuse to be spoken to in that tone. Readers Digest

If you too are leaving your job for another position or retiring completely, you probably have a zillion things on your mind. But don’t forget about the assets in your 401(k) plan or other qualified plan at work. There are several options to consider.

• Leave the money where it is. But remember that you won’t be connected any longer with the employer providing the plan.

• Cash in the funds at a hefty tax price. Generally, the payout will be taxed at ordinary income rates, now reaching as high as 39.6% Federal and 9% to 12% in California. Plus, you’ll be assessed a 12.5% tax penalty (for both Federal and CA) if you’re under age 59½, unless a special exception applies.

• Roll over the funds to a traditional IRA (or another qualified plan if one is available at a new job). The rollover is exempt from income tax if it is completed within 60 days of the distribution.

The rollover-to-an-IRA option is often preferable since it preserves your nest egg without any tax erosion while offering a wide array of investment choices. But this tax-saving technique is not without its perils.

Notably, if you don’t meet the 60-day deadline, the payout is treated as a taxable distribution. Also, if you receive the funds, the plan administrator will withhold tax at a 20% + rate, even if you intend to roll over within 60 days. Thus, you can’t recoup this amount until you file your tax return for the year of the transfer. To avoid withholding, arrange a “trustee-to-trustee transfer” to the IRA where your hands never touch the money. Finally, if you roll over funds to a Roth IRA instead of a traditional IRA, you must pay tax like any other Roth conversion.

Review your options and choose what’s right for you. Contact us if you would like help investigating the alternatives.