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Flitt writes:

I spoke with Waterhouse about opening a Roth IRA. I wanted a contributory Roth for my $2000 per year that I could also roll my IRA from my old 401K into.

They make it seem like there is no such animal. Is this right? Do I have to have two accounts and pay double commisions to trade my Roth money?

O.k., you have to stay after school for failing to pay attention in class. We covered that issue extensively last week. Obviously, you weren't paying attention. To the blackboard, young man, and write 100 times "I will read the posts daily."

As part of the IRS Restructuring bill just enacted, Congress eliminated any and all need to keep contributory and conversion Roth IRAs as separate accounts. However, this freedom to comingle the monies hasn't registered with all Roth providers yet. Keep complaining. My guess is by the end of the year all Roth providers will eliminate that idiotic requirement.

Also, will I be taxed when I buy and sell securities inside of a Roth IRA?

No, no, a thousand times no. Trading within an IRA of any type is not a taxable event.

If so, I'd want to wait 366 days to balance my portfolio , correct?

The 366 days is of importance only in a taxable account so you can take advantage of the long-term capital gains rates instead of being hit with short-term capital gains at ordinary tax rates. There are no tax impacts on trades in the Roth, so if you want to use 364 or 365 days instead of 366, it matters not.


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