 |
|
|
|||||
| « Previous thread | Next thread » |
I'm 68 years old and have a work related 401(k) rollover brokerage
account. I'd like to transfer my deceased spouses IRA to that account
without penality. The account is with a different brokerage firm and
I am the soul beneficiary. The account is titled:
MY NAME BENE
MY WIFE'S NAME DCD IRA CNDT
I don't know what the CNDT stands for. She has been deceased for more
than 5 years.
If I can do this, should I have her brokerage firm send me a check and
then I send it to my broker? or can I do a transfer between firms?
Thanks in advance for your advice.
Dave
--------------------------------------
Misc.invest.financial-plan is a moderated newsgroup where Moderators strive
to keep the conversations on-topic for financial planning. Other posting
guidelines include a request for brevity and another for trimming posts to
which we respond. For all of the other tips and suggestions, see "FROM THE
MODERATORS: Posting to misc.invest.financial-plan", a weekly post now on the
Newsgroup.
On Jul 26, 9:14 am, drace1 <d...@g...com> wrote:
> I'm 68 years old and have a work related 401(k) rollover brokerage
> account. I'd like to transfer my deceased spouses IRA to that account
> without penality. The account is with a different brokerage firm and
> I am the soul beneficiary. The account is titled:
> MY NAME BENE
> MY WIFE'S NAME DCD IRA CNDT
> I don't know what the CNDT stands for. She has been deceased for more
> than 5 years.
> If I can do this, should I have her brokerage firm send me a check and
> then I send it to my broker? or can I do a transfer between firms?
IIRC, you can't transfer funds in a IRA to a 401(k). However, you can
transfer your spouse's IRA to your IRA.
--
Ron
--------------------------------------
Misc.invest.financial-plan is a moderated newsgroup where Moderators strive
to keep the conversations on-topic for financial planning. Other posting
guidelines include a request for brevity and another for trimming posts to
which we respond. For all of the other tips and suggestions, see "FROM THE
MODERATORS: Posting to misc.invest.financial-plan", a weekly post now on the
Newsgroup.
"drace1" <d...@g...com> wrote in message
news:3ea9c753-2085-4326-8a12-09e66fde615a@a2g2000prm
.googlegroups.com...
> If I can do this, should I have her brokerage firm send me a check and
> then I send it to my broker? or can I do a transfer between firms?
>From everything I've heard, you should *never* have a financial institution
send you a check from an IRA if you're intending to move it, because of the
risk that the transaction might be considered taxable. Instead, transfer
directly from one firm to the other.
--------------------------------------
Misc.invest.financial-plan is a moderated newsgroup where Moderators strive
to keep the conversations on-topic for financial planning. Other posting
guidelines include a request for brevity and another for trimming posts to
which we respond. For all of the other tips and suggestions, see "FROM THE
MODERATORS: Posting to misc.invest.financial-plan", a weekly post now on the
Newsgroup.
On Jul 26, 9:14 am, drace1 <d...@g...com> wrote:
> I'm 68 years old and have a work related 401(k) rollover brokerage
> account. I'd like to transfer my deceased spouses IRA to that account
> without penality. The account is with a different brokerage firm and
> I am the soul beneficiary.
>
> If I can do this, should I have her brokerage firm send me a check and
> then I send it to my broker? or can I do a transfer between firms?
See http://www.irs.gov/publications/p590/ch01.html#d0e33
24 for IRS
instructions regarding inherited IRAs. As I read it, it is permissible
to transfer your deceased spouse's IRA to your own.
You can have your spouse's IRA custodian send you a check, which you
can deposit into your IRA within 60 days, but I think the easiest way
is to have your IRA custodian take care of the transfer.
Dave
--------------------------------------
Misc.invest.financial-plan is a moderated newsgroup where Moderators strive
to keep the conversations on-topic for financial planning. Other posting
guidelines include a request for brevity and another for trimming posts to
which we respond. For all of the other tips and suggestions, see "FROM THE
MODERATORS: Posting to misc.invest.financial-plan", a weekly post now on the
Newsgroup.
Ron Peterson wrote:
> IIRC, you can't transfer funds in a IRA to a 401(k). However, you can
> transfer your spouse's IRA to your IRA.
Afraid you are behind the code changes. It used to be you needed to keep
a 401(k) rollover to an IRA in a specially titled 'rollover' account if
you had any intention of putting it into a future 401(k). Now, employer
permitting, I am allowed to transfer any pre-tax IRA money I have into
my 401(k).
Why would one do this?
A) You can retire from the company at 55 and take withdrawals without
being subject to the 59-1/2 age rule or worrying about Sec(72t) math.
B) Having saved $50K in non-deductable IRA deposits, this is the chance
to convert it to Roth, and not be subject to taxes. If there's no
pre-tax IRA money to tax, the conversion is free. Wahoo!
C) The 401(k) has some low cost fund, or otherwise closed fund that
can't be gotten into otherwise.
But I don't think OP asked that. He said he has a "work related 401(k)
rollover brokerage account." That's ambiguous enough to me. Sounds like
he already rolled the 401(k) to an IRA, but just wants to combine
accounts. It also sounds like the deceased spouse account was retitled
as I warn people they must title a non-spousal inherited IRA. There may
have been a valid reason to do so, but that titling prevent the accounts
from getting combined, I believe. It also impacts the way RMDs are
calculated, I also believe.
You are right that one can transfer the spouses IRA into their name and
it's theirs, as if it always was. I just don't know if the current
scenario is undoable.
Joe
--------------------------------------
Misc.invest.financial-plan is a moderated newsgroup where Moderators strive
to keep the conversations on-topic for financial planning. Other posting
guidelines include a request for brevity and another for trimming posts to
which we respond. For all of the other tips and suggestions, see "FROM THE
MODERATORS: Posting to misc.invest.financial-plan", a weekly post now on the
Newsgroup.
On Jul 26, 1:20 pm, "Andrew Koenig" <a...@a...org> wrote:
> From everything I've heard, you should *never* have a financial institution
> send you a check from an IRA if you're intending to move it, because of the
> risk that the transaction might be considered taxable. Instead, transfer
> directly from one firm to the other.
There is no danger of the transaction being taxable if you complete
the rollover within 60 days. The old custodian will send you a form
next January saying that you took a distribution. You enter that on
your tax return, e.g., on line 15a of the the Form 1040. Right next
to that, on line 15b, you report the taxable portion of that
distribution. If you completed the rollover within 60 days, the
taxable portion would be $0. Line 15b then is one of the lines that
enters into the adjusted gross income. Line 15a is not used anywhere
else that I am aware of.
I do think that a trustee-to-trustee transfer is the easiest way to
go, though.
Dave
--------------------------------------
Misc.invest.financial-plan is a moderated newsgroup where Moderators strive
to keep the conversations on-topic for financial planning. Other posting
guidelines include a request for brevity and another for trimming posts to
which we respond. For all of the other tips and suggestions, see "FROM THE
MODERATORS: Posting to misc.invest.financial-plan", a weekly post now on the
Newsgroup.
Dave Dodson wrote:
> On Jul 26, 1:20 pm, "Andrew Koenig" <a...@a...org> wrote:
> > From everything I've heard, you should never have a financial
> > institution send you a check from an IRA if you're intending to
> > move it, because of the risk that the transaction might be
> > considered taxable.
> There is no danger of the transaction being taxable if you complete
> the rollover within 60 days. The old custodian will send you a form
> next January saying that you took a distribution. You enter that on
> your tax return, e.g., on line 15a of the the Form 1040. Right next
> to that, on line 15b, you report the taxable portion of that
> distribution.
> I do think that a trustee-to-trustee transfer is the easiest way to
> go, though.
Sometimes you don't have a choice. My 401(k) won't send a rollover to
another institution, but insists on sending a check to the address of
record. They cite security reasons.
An important thing to do if you do receive a check is to make sure the
sending custodian processes it as a rollover. That way taxes won't be
withheld. The check should be made out the receiving custodian, with
for-benefit-of designation in your name.
Brian
--------------------------------------
Misc.invest.financial-plan is a moderated newsgroup where Moderators strive
to keep the conversations on-topic for financial planning. Other posting
guidelines include a request for brevity and another for trimming posts to
which we respond. For all of the other tips and suggestions, see "FROM THE
MODERATORS: Posting to misc.invest.financial-plan", a weekly post now on the
Newsgroup.
On Jul 26, 6:25 pm, "Default User" <d...@y...com> wrote:
> Dave Dodson wrote:
> > I do think that a trustee-to-trustee transfer is the easiest way to
> > go, though.
>
> Sometimes you don't have a choice. My 401(k) won't send a rollover to
> another institution, but insists on sending a check to the address of
> record. They cite security reasons.
We were talking about IRA to IRA rollovers, not a 401(k) to IRA
rollover. Do you know of an IRA that refuses to do a trustee-to-
trustee transfer?
Dave
--------------------------------------
Misc.invest.financial-plan is a moderated newsgroup where Moderators strive
to keep the conversations on-topic for financial planning. Other posting
guidelines include a request for brevity and another for trimming posts to
which we respond. For all of the other tips and suggestions, see "FROM THE
MODERATORS: Posting to misc.invest.financial-plan", a weekly post now on the
Newsgroup.
Dave Dodson <d...@j...com> wrote:
>On Jul 26, 1:20 pm, "Andrew Koenig" <a...@a...org> wrote:
>> From everything I've heard, you should *never* have a financial institution
>> send you a check from an IRA if you're intending to move it, because of the
>> risk that the transaction might be considered taxable. Instead, transfer
>> directly from one firm to the other.
>
>There is no danger of the transaction being taxable if you complete
>the rollover within 60 days.
But if the check is made to you, the old trustee is required to withhold 20% for
taxes. That means you have to come up with the cash to cover that 20% to
deposit into the new account. One of Congress's nicer FY rules.
The check must be made out as <new trustee> "for the benefit of" <your name>.
-- Doug
--------------------------------------
Misc.invest.financial-plan is a moderated newsgroup where Moderators strive
to keep the conversations on-topic for financial planning. Other posting
guidelines include a request for brevity and another for trimming posts to
which we respond. For all of the other tips and suggestions, see "FROM THE
MODERATORS: Posting to misc.invest.financial-plan", a weekly post now on the
Newsgroup.
On Jul 26, 8:01 pm, Douglas Johnson <p...@c...com> wrote:
> But if the check is made to you, the old trustee is required to withhold 20% for
> taxes. That means you have to come up with the cash to cover that 20% to
> deposit into the new account.
We are talking about IRA to IRA transfers. This withholding rule you
mention is for distributions to you from a 401(k), not distributions
to you from an IRA. There is no withholding rule for distributions
from an IRA. You can have your old IRA custodian send you a check,
made out to you if you wish, for the entire balance of your account.
You can deposit that check into your checking account, and then,
before 60 days have passed, send a new check to your new IRA custodian
to fund a new account or add to an old one.
I'm finding so much misinformation in this thread. It is true that the
rules are convoluted, but that just means that you have to be careful
to understand them.
Dave
--------------------------------------
Misc.invest.financial-plan is a moderated newsgroup where Moderators strive
to keep the conversations on-topic for financial planning. Other posting
guidelines include a request for brevity and another for trimming posts to
which we respond. For all of the other tips and suggestions, see "FROM THE
MODERATORS: Posting to misc.invest.financial-plan", a weekly post now on the
Newsgroup.
| « Previous thread | Next thread » |
Short-term Fund purchasing advice...
Financial Guru: Buy-and-Hold a Thing of the Past
Another suicide due to financial crisis.
Financials in a fixed income account
Is my marginal tax rate really 67.53%?
Article about CDARS and other alternatives
uncertain about my Fidelity IRA and the economy
Juicy RSS feeds for financial awareness?
Up