What You Need to Know About IRA Rollover Rules and IRA Rollovers to Maximize Gains
Follow The Rules If you don't follow the IRA rollover rules, the total balance in your account can be taxed as income for the year.
Sometimes, they are referred to as "60-day IRA rollovers", because you have 60 days to deposit the money into another IRS approved account.
If you meet the deadline, there is no penalty.
Real Life Example Under the IRA rollover rules, you can only complete a transaction of this nature once every year.
I knew an investor that was unhappy with his choice of custodians, he knew about IRA rollovers, but he wasn't aware of all of the rules.
He wasn't any happier with his new custodian and he did not know that IRA rollovers are only allowed once per year.
His lack of knowledge cost him a pretty big chunk of his retirement savings at tax time.
If he had "transferred" the funds, instead of having the custodians cut him a check, he could have hopped from one custodian to another with no penalty.
Transfers between IRS approved custodians are not even reported to the IRS.
Report Rollovers Under the IRA rollover rules, roll-overs must be reported.
Once you choose a new custodian, they send you a form to attach to the end of year tax return.
That shows the IRS that your funds were re-deposited into another approved account and you pay no penalty.
About Transfers Transfers are a little safer than IRA rollovers, so, if you have the time, choose a new custodian first.
At the very least, it will save you time on your year-end taxes.
At most, it could save you a lot of money.
Consider The Self Directed Approach If you haven't thought of it, you might want to consider the self-directed approach this time.
There are a couple of very good self-directed custodians that charge reasonable fees and offer all of the investment options allowed by law.
Other Profitable Options.
You don't have to stick with low-paying stocks, bonds and CDs.
Real estate, for example, is usually a good choice.
Today's economic environment has created some new opportunities in the real estate market.
People are buying foreclosures, fixing them up and renting them out or reselling them.
More "socially conscious" investors are taking a different approach, will still earning nice returns.
Under the IRA rollover rules, you are allowed to join with others and affect change in communities where change is badly needed.
The houses in these neighborhoods are literally crumbling, as they've been neglected for years at a time.
But, these would be highly desirable locations, if only the houses were in better condition.
This is a "hidden real estate market" that beginning and seasoned investors are cashing in on while helping others.
The best time to investigate all of your options is before you make IRA rollovers.
The best time to invest in real estate is right after the roll-over is completed.
At that time, you should have a relatively large cash balance.
All that you need do to get involved is open a self-directed account and get a little more information.
Remember the IRA rollover rules, think about the real estate market and look forward to a financially secure future.
Sometimes, they are referred to as "60-day IRA rollovers", because you have 60 days to deposit the money into another IRS approved account.
If you meet the deadline, there is no penalty.
Real Life Example Under the IRA rollover rules, you can only complete a transaction of this nature once every year.
I knew an investor that was unhappy with his choice of custodians, he knew about IRA rollovers, but he wasn't aware of all of the rules.
He wasn't any happier with his new custodian and he did not know that IRA rollovers are only allowed once per year.
His lack of knowledge cost him a pretty big chunk of his retirement savings at tax time.
If he had "transferred" the funds, instead of having the custodians cut him a check, he could have hopped from one custodian to another with no penalty.
Transfers between IRS approved custodians are not even reported to the IRS.
Report Rollovers Under the IRA rollover rules, roll-overs must be reported.
Once you choose a new custodian, they send you a form to attach to the end of year tax return.
That shows the IRS that your funds were re-deposited into another approved account and you pay no penalty.
About Transfers Transfers are a little safer than IRA rollovers, so, if you have the time, choose a new custodian first.
At the very least, it will save you time on your year-end taxes.
At most, it could save you a lot of money.
Consider The Self Directed Approach If you haven't thought of it, you might want to consider the self-directed approach this time.
There are a couple of very good self-directed custodians that charge reasonable fees and offer all of the investment options allowed by law.
Other Profitable Options.
You don't have to stick with low-paying stocks, bonds and CDs.
Real estate, for example, is usually a good choice.
Today's economic environment has created some new opportunities in the real estate market.
People are buying foreclosures, fixing them up and renting them out or reselling them.
More "socially conscious" investors are taking a different approach, will still earning nice returns.
Under the IRA rollover rules, you are allowed to join with others and affect change in communities where change is badly needed.
The houses in these neighborhoods are literally crumbling, as they've been neglected for years at a time.
But, these would be highly desirable locations, if only the houses were in better condition.
This is a "hidden real estate market" that beginning and seasoned investors are cashing in on while helping others.
The best time to investigate all of your options is before you make IRA rollovers.
The best time to invest in real estate is right after the roll-over is completed.
At that time, you should have a relatively large cash balance.
All that you need do to get involved is open a self-directed account and get a little more information.
Remember the IRA rollover rules, think about the real estate market and look forward to a financially secure future.