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Investor Insights Blog|Moving Funds or Assets from One Custodian to Another

Managing Your Account

Moving Funds or Assets from One Custodian to Another

Are you looking to, or considering, moving funds or assets from one custodian or another? Here are a few things to know.

What is a rollover?

A rollover is when a person requests a personal distribution from his or her account and then redeposits, or “rolls,” the money into a like tax environment account.

Taxes and penalties can be avoided if the distributed funds are deposited into a like account within 60 days from the date of distribution. The IRS allows one IRA rollover in any 12-month period – per person, not per IRA.

It’s important to remember the 12-month period begins on the date a person receives the IRA distribution – not on the date it is rolled back into an IRA.

What is a transfer?

A person can complete a transfer if he or she holds an IRA at another financial institution and would like to move to an Equity Trust account.

Transferring funds from one custodian to another is a nontaxable event – providing the account types are the same tax environment.

This is often described as “transferring like to like.” It’s not a reportable event when someone moves funds from one custodian to another, without ever taking personal ownership of the funds.

Unlike rollovers, the IRS does not limit the number of custodian to custodian transfers a person can do within any particular time frame – nor does it a set time period the transfer must be completed.

Cash and assets, in-kind, can be moved through a transfer. The account holder can transfer all or only part of the holdings in a timing that works best for his or her goals.

1

Am I required to transfer my entire account?

No. You can move all of your assets or only part of your account’s holdings as you see fit to your new account at Equity Trust. Since there are no limits to the number of transfers you can do in a year, you can move your cash and/or other assets when it works best for your goals.

2

Can I roll over a 401(k) account into a self-directed IRA?

Yes. A self-directed IRA gives you the ability to diversify your portfolio with additional investments that are permitted by the IRS, in a tax-free or tax-deferred environment.

3

Can I roll over funds from a qualified retirement plan if I am still employed and am a member of that plan?

Yes, it is allowed, but you will need to check with your plan administrator or human resources department to determine if it is permissible within the structure of your employer’s retirement plan.


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