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Subject:  Re: IRA Portfolio Management Tax Question Date:  12/17/1998  7:46 AM
Author:  TMFPixy Number:  7347 of 94940

Greetings, ChristopherSusi, and welcome. You asked:

<<If I were to move my assets within the IRA to a new fund (assuming same investment company and no load), are there tax penalties? Someone who I feel is semi-knowledgeable said that I would take a hit (On the gains I am assuming).

This seems counter-intuitive though. It implies if I were getting high returns in an aggresive fund, and move to a less risky fund later on then I'd could lose some money on the deal.>>

Your friend is incorrect. As long as the money stays within the IRA, you may transfer it to another fund without penalty and without taxes. The only time taxes and penalties apply is when the money is improperly transferred to a new IRA because the owner personally received a distribution and failed to put it in a new IRA within 60 days or the owner tried to roll the money twice within a 12-month period. As to the latter, a direct transfer between custodians (one in which the owner never gets the money) avoids that problem entirely.


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