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Financial Planning / Tax Strategies


Subject:  5-Year Tax Rules for Roth IRA's Date:  1/26/1998  1:37 AM
Author:  TMFBogey Number:  1527 of 123001

Regarding the 5-Year Tax rules, TMF Taxes writes:

Complicated? You bet. I told you in our first installment on this issue that it has turned into a monster. And it gets even more complicated when you combine regular Roth IRA contributions with Roth IRA rollover accounts. I have read complaints from many of you in the Tax Strategies folder about your broker "forcing" you to open separate accounts for Roth IRA rollovers, contributions, etc. You should know that the broker is simply following an IRS recommendation officially directed to all Roth IRA trustees. And while separate accounts may cost you additional amounts for annual administrative fees, set up fees, etc., it very well may be in your best interest to set up these separate accounts unless and until you fully understand the Roth IRA distribution and penalty rules.

If you feel confident that you understand the rules, and wa