You have to think of the IRS like they’re pirates out to steal your money. They want to get into your home. They want to carry off your daughter. They are the barbarians at the gate.Our clients are wealthy investors who will pay their fair share when and where they are obligated. But there are ethical and legal means to keeping more of their money, and it’s our job to help them find those means.Here’s one way to keep the government’s greasy fingers off of your retirement savings by bypassing the withholding tax on 401(k) distributions. Tax Advantage of Retirement Tax SavingsYour 401k is subject to a 20% withholding tax when you cash in. IRA distributions, however, aren’t subject to taxation at the time of distribution.That means you have a head start against the pirates.This is the easiest switch in the world. Dump your 401(k) into an IRA. To get started, check out our article, IRA Rollovers: Yes, Rolling Over Your 401(k) Into An IRA Is Smart!Everything in your 401(k) is going to take this hit. But your IRA is all yours.Now, this isn’t a complete get-out-of-jail free card. The real world isn’t Monopoly and you’re going to look like an idiot if you start wearing a monocle.The tax owed on the distribution of an IRA or 401(k) is identical. You will still receive a 1099-R. The difference is when you have to pay the piper. If you keep your 401(k), you pay the Man up front. The Difference 20 Percent Can MakeYou may not think 20 percent is a big deal, but with a little creativity, 20 percent is going to add up. There’s nothing wrong with retiring on the beach. My buddy (we’ll call him John) took $500,000 from his 401(k) and he went got himself a fine little spot with plenty of sun and plenty of surf.My buddy Sam, on the other hand, talked to me first. So, when he pulled his half a million bucks out of his IRA, we figured out how to get him a beach house like John. We also figured out how to put a little boat at the end of the pier for him. Sam loves to fish, so we invested a little in a fishing business too. Sam doesn’t care if the fishing business makes any money, but he got to keep enough money to buy a boat and make it a business expense. He also got to retire with a nice expensive Dunhill cigar in his hand. John only gets a nice smoke when Sam is feeling generous.It’s no contest folks. IRA or give your money away.