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Author: WilliamLipp Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121061  
Subject: Keogh Transfer Date: 7/12/1999 6:00 PM
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I have a Keogh Profit Sharing Plan and a Keogh Money Purchase Plan with the bank and their high fee brokerage. I've opened up new accounts with a discount broker, filling out the forms with the boxes checked that say "This is an amendment and restatement of an existing profit sharing/money purchase plan (a Prior Plan)." The next step was going to be transfer most of the assets in pieces. Long range I planned to make deposits annually at the bank, then transfer to discount brokerage. This would be a no-brainer with IRAs - just fill out the custodial transfer forms. The bank is claiming this is not possible with Keogh Accounts. They are claiming that IRS rules require a single custodian. I'm suspicious because it takes eight weeks to get an answer from them, and their justification is to point to a clause in the Plan that deals with permitted investments, not custodial transfers. Does this make any sense, or does it sound like I'm getting the runaround?
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Author: edcosoft Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 17212 of 121061
Subject: Re: Keogh Transfer Date: 7/12/1999 7:07 PM
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You should get a more professional reply than this, but I had this problem years ago and just opened a new Keogh, which was the only way to change investment vehicles. I ultimately had 6 Keoghs and none referred to "ammendment or restatement". It appears you were going to leave assets with bank and start new investments in the new Keogh, which is O.K. You'll need another 5500 is all. I'm not sure about this, but I think in order to transfer actual assets you'll have to sell the bank stock, sign a transfer form for the new Keogh to ask the bank for the cash, then purchase whatever stock you want when the cash comes in. At least that is how I consolidated mine.
Most Keoghs have a prohibition, or limitation, to outside investments but this doesn't apply to other Keoghs you may have. Ed

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Author: WilliamLipp Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 17309 of 121061
Subject: Re: Keogh Transfer Date: 7/14/1999 2:30 PM
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WilliamLipp Date: 7/12/99 6:00 PM Number: 17206
The bank is claiming this is not possible with Keogh Accounts. They are claiming that IRS

My bank, holder of my first Keogh, is claiming it is illegal to transfer part of these funds to a different custodian, like you could in an IRA. They claim that as a matter of law it's all or nothing. I think they are making it up - does anyone know if it's really true?

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Author: TMFTaxes Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 17328 of 121061
Subject: Re: Keogh Transfer Date: 7/14/1999 10:03 PM
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[[ They are claiming that IRS rules require a single custodian. I'm
suspicious because it takes eight weeks to get an answer from them, and their
justification is to point to a clause in the Plan that deals with permitted
investments, not custodial transfers. Does this make any sense, or does it sound
like I'm getting the runaround?]]

I think that you are getting the runaround, yes. But this is not my area of expertice. I would suggest that you take this question over to the Retirement Investing message folder and post it to TMF Pixy. This is Pixy's line of work...on a day to day basis...and he would likely know the answer right off the top of his head.

I did some quick research, and could find nothing that points to the IRS requiring only one custodian or administrator. But perhaps there is something there that I'm not seeing. So check with Pixy. I'm sure that he can help you.

TMF Taxes
Roy

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