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If I want to move the funds in an IRA at one financial

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If I want to...

If I want to move the funds in an IRA at one financial institution to an IRA at another financial institution, will I have to pay taxes on the money being moved or transferred at the time it is moved?

Accountant's Assistant: The Accountant will know how to help. Is there anything else important you think the Accountant should know?

The advisor at the bank said she thought I would have to pay taxes of about $5,000 on a transfer of $37,681.11 when or if I move the full balance over to an existing IRA account at another financial institution---a credit union. is this true?

Submitted: 7 months ago.Category: Tax
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11/30/2017
Tax Professional: Robin D., Senior Tax Advisor 4 replied 7 months ago
Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
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Experience: 15years with H & R Block. Divisional leader, Instructor
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Hello, I'm Robin. Welcome to JustAnswer. I'm reviewing your question now and typing up my reply. I'll post that in just a few moments.

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Tax Professional: Robin D., Senior Tax Advisor 4 replied 7 months ago

Rollovers are not taxable. A rollover is when you move funds from one deferred account (like a Trad IRA) to another. There are many methods to do this, you get a check and complete the rollover within 60 days, a direct rollover form one institution to the other, and when you receive a check made out to the different IRA and "walk" it there your self.

As long as the accounts are both the same then no tax to you.

If you move form a TRAD IRA to a ROTH you pay tax.

Are you moving from TRAD to TRAD?

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Tax Professional: Robin D., Senior Tax Advisor 4 replied 7 months ago

AS additional info, you can only make one rollover from an IRA to another (or the same) IRA in any one-year period, regardless of the number of IRAs you own. A trustee-to-trustee transfer isn't a rollover and isn't affected by this rule. This rule also doesn't apply to you if you convert a traditional IRA to Roth IRA.

The only thing I can think of that they meant was if they withhold (this if you just take money out) and then you will have to make up the difference when you place it in the new IRA. For this reason a Trustee to Trustee is better as all is done electronically. No taxes withheld.

Please let me know if you need more information.
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