Saving for retirement is the first step towards a prosperous future. In order to maximize retirement savings, it’s important to keep tax considerations and withdrawal rules in mind. Using the right saving strategies can help you to pay fewer taxes and get more out of your retirement.

Rules for retirement plans often change over time. As such, it’s helpful to stay current on the latest changes that may impact your retirement fund. The Wall Street Journal shares the latest tax rule change for Roth IRAs and how it impacts you:

“Last month, the Internal Revenue Service issued a ruling that allows big savers to use their 401(k) accounts to fund Roth IRAs—without paying income taxes in the process.

“Because the ruling offers a tax-free way to convert money to a Roth IRA, ‘everyone who is retiring from a company and is therefore looking at rolling money out of the company plan should investigate this if they have after-tax money in the plan,’ says Natalie Choate, an attorney with Nutter, McClennen & Fish in Boston. ‘It’s a no brainer.’

“For you to take advantage of the ruling, your 401(k) plan must allow after-tax contributions. Popular with small businesses, after-tax contributions are permitted by almost half of large-employer plans, according to Aon AON +1.30% Hewitt, a 401(k) record keeper.

“Here’s how they work: Currently, 401(k) participants under age 50 can divert up to $17,500 of their annual pay into a pretax or Roth 401(k) account, or a combination of the two. (The limit for those 50 or older is $23,000.) But those who want to save more can make after-tax contributions to a traditional 401(k) plan. The combined limit on pretax, Roth, after-tax, employer match and other contributions is $52,000 a year ($57,500 for those 50 or older.)

“After-tax contributions receive the fewest tax breaks. With pretax contributions to a traditional 401(k), for example, employees deduct their contributions and pay income tax on their withdrawals in retirement—when they may be in a lower tax bracket. With a Roth, employees forego an upfront tax deduction but their withdrawals can be tax-free. But with after-tax contributions, account owners receive no deductions and must pay income tax on the profits they earn.

“Now, the IRS is letting 401(k) participants transfer after-tax contributions to a Roth IRA, where the money can grow tax-free. Whereas in the past, anyone who did this had to transfer or ‘convert’ some pretax money to the Roth and pay income tax, it’s now possible to skip the tax entirely, says Ed Slott, an IRA expert in Rockville Centre, N.Y.

“It’s important to keep some rules in mind. Before moving after-tax contributions to a Roth, those 59½ or older must first transfer their pretax savings to a traditional IRA. If you want to move only some of your pretax 401(k) money—say, for example, half of it—into a regular IRA, you may move only the same proportion (i.e., half) of your after-tax balance into a Roth, says Mr. Slott. If you’re younger than 59½, you may be able to move all of your after-tax money without transferring any pretax dollars. Not all plans allow employees to withdraw funds before age 59½, says Mr. Slott.”

Also, following a ruling by the Supreme Court, only the original owners of traditional and Roth IRAs have protection against federal bankruptcy of up to $1.245 million; any heir to whom they transfer the account does not enjoy this privilege. Despite this, smart tax and financial planning is a great way to increase savings and benefits, particularly when it comes to retirement.