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Dont know if Im really posting this in the right forum. If not, please recommend the correct forum for posting.

Here goes....

In my IRA account, the fund (putnam new opps) was started in 96 and was orginally a Traditional IRA, converted over to a Roth in 98.
In 2004 I went to put more money into this acct, when I received my statement, there are two seperate entries for the same fund. The orginal amount in the orginal entry and the new dollars for the newer entry.
Calling my broker, he had said that it was because putnam policy is if a fund was converted over to a roth, any new contributions was not allowed to be put in the same fund, a new fund is created even though its held in the same account. Thus the reason for having two Entries (for the same fund)in the same account on the statement.

Is this correct procedure?

Something else that i cant figure out is that all my funds have very similar acct# give or take a few digits here and there. The New fund in 04, the account# is not even close to looking like the others..
Does this sound like its correct procedure?? and im just paranoid....Asking for some guidence on this issue, I know that putnam was involved with some broker/trading issues, a while back. Would appreciate some feed back on this.

Thanks
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I would imagine it is more a tax issue than anything else. You have to pay taxes on the amount that was rolled over, you already paid taxes on the new contributions.

Fuskie
Who does not really know, but thought it important to post something...
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Fuskie,
Hyperspud had to pay taxes when he rolled his Traditional IRA into the Roth. There aren't more taxes to pay when he takes it out of the Roth.
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Hyperspud had to pay taxes when he rolled his Traditional IRA into the Roth. There aren't more taxes to pay when he takes it out of the Roth.

That is correct. I am guessing, however, that the broker seperated the accounts to distinguish between those taxed during the rollover and those contributed normally.

Fuskie
Who could be wrong...
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Hyperspud had to pay taxes when he rolled his Traditional IRA into the Roth. There aren't more taxes to pay when he takes it out of the Roth.

If this was a conversion there is a 5-year clock that the converted fund has--withdrawals of converted monies before the end of 5 years has penalties unless one is already 59.5 years old and has had a Roth IRA for at least 5 years when the converted funds are withdrawn.
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If this was a conversion there is a 5-year clock that the converted fund has--withdrawals of converted monies before the end of 5 years has penalties unless one is already 59.5 years old and has had a Roth IRA for at least 5 years when the converted funds are withdrawn.

I have just a minor correction to this excellent response. If one is over the age of 59 1/2, then how long the Roth IRA has been open is immaterial. The converted money may be taken free of taxes (they've already been paid) and free of the early withdrawal penalty (the magic age has already been reached). Indeed, it's as if the converted money was still in the TIRA except that the taxes due on withdrawal from the TIRA were paid in advance.

OTOH, if earnings on the converted money are withdrawn from the Roth before the five years run, then those withdrawals will be taxed. Because of age, no penalty is involved, but taxes are because the five years have yet to run to avoid them.

Regards ... Pixy
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Ok im not over 59 1/2 and you have lost me a little on the 5 year thing,Are you saying they kept it seperate because of that?
Because then that doesnt make sense either as it was converted in 98 and i didnt add to that fund until 04, thats 6 years.
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