Simple question (I've searched the site and not found an answer): Girlfriend bought several shares of stock early this year thru online broker (DLJdirect). Now wants to move these already owned shares into an IRA. Broker answered emailed question by saying no, you can't shift stocks from a regular brokerage account into an IRA account. It seems odd not to be able to do so. Is this standard policy, or is DLJ being weird (or the email answerer being lazy), and might another broker gladly start an IRA using already owned securities?Thanks for any help.
My experience is you can transfer shares of assets (stocks or mutual funds etc) from one IRA to another without selling them. However, most will not allow you to transfer them from a regular account to an IRA. You must make to contributions to the IRA in cash.If however, you make the contribution in cash you may be able to sell your own shares to your IRA account. I would bet that a broker could arrange this transfer and possibly at less than full commission rates. However, I would bet the shares must be sold at market prices. Interesting things can happen if you sell your IRA account your own shares at other than market prices. There are probably rules to prevent such transactions.
Is this standard policy, or is DLJ being weird Sorry, it's the rule. New contributions to an IRA can only be made in cash. You can only transfer non-cash assets between IRAs, or when you rollover retirement money into an IRA.Zev
no wierdness or laziness here. Contributions to an IRA must be made in cash... IRS regs. Most reasonable alternative is to sell the stock (presumably at a gain) pay taxes on the gain and contribute that money to an IRA. You will pay taxes and commissions that could have been avoided if the cash had been contributed to an IRA in the first place, but it is not the end of the world. Just think of the extra expense as tuition at the school of street smarts.
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