Is it possible to borrow from your own IRA and pay yourself back?
The official answer is "no". You can, for a 60 day limit. Here's how it is done: you start with two IRAs. Tell the custodian of one that you want to move a sum of money to the other one, and you want a check. You must have the cash in that account, because you cannot borrow against securities in the account. You have 60 days to deposit the money in the other IRA, from the day the check was cut. If you are one day late in getting the money to the second IRA, you blew the whole thing, and have made a withdrawal from your IRA, complete with penalty if you are under 59 1/2. The above maneuver cannot be done more than once in a year. Offhand, I can't think of a reason why I'd do it at all, but maybe if a very dear friend was in jail and needed bail money? Best wishes, Chris
<< Offhand, I can't think of a reason why I'd do it at all, but maybe if a very dear friend was in jail and needed bail money? >>As an ardent fan of "Judge Judy" (the show, not necessarily everything that comes out of her mouth), I'd caution against this. It seems NO ONE pays back their friends who post bail <g>.TMF ExROPhil Marti
pgirl,You can take the money out of an IRA, once a year, and as long as you put it back into the IRA within 60 days, "no foul, no harm"--if you don't get it back within the 60 day period, you pay taxes and 10% premature distribution penalty on amount taken out.ez
Although you can do this as the other posts suggest, you don't want to. This is sacred money. Future money to which you will apply the magic of compounding. Once you start thinking of it as a source for a loan, even short term you lose the magic. Many people I know have 401(k)s with loan provisions. They borrow out to the max and then wonder why they aren't making real progress toward retirement goals. These are the same people carrying huge balances on plastic.I am convinced that you are better off getting the money someplace else rather then touching any retirement asset. The old you will thank the young you for keeping your cotton pickin' hands off it!
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