Puerto Rico "401K" rollover to the US (complicated)

Jun 16, 2014
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I have $60K in a Puerto Rico 1165e from when I worked there. I do not live there now and will not live there again. All I want to do is roll that money into a rollover IRA at Vanguard in the states. Sounds simple? It's not. I've spent 8 hours on the phone with about 9 people and I still don't have an trustworthy answer.

Unanimously everyone says that the PR bank will take 20% and give it to the PR government. The consequences of that no one can agree on.

My question is then what? Can I get that 20% as a tax credit here in the US? Since I don't owe any more taxes here will the Feds just give me a $12K refund even though that 12K is in PR?

Am I done paying taxes on it? Will I have to pay a 10% penalty? To avoid the 10% early withdrawal penalty if I put it in a IRA here I will have to pay taxes on it again when I take it out?

Thanks for any help!!! :)

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