retirement

9 common misconceptions about IRAs

Retirement » 9 common misconceptions about IRAs

The experts will fill you in
The experts will fill you in © Jeanette Dietl/Shutterstock.com

The experts will fill you in

IRAs are complicated beasts, and there is no way to learn all the things you don't know. Similarly, your bank, broker or IRA custodian may not know what you know, and it's not the financial institution's responsibility to hold your hand.

For instance, if you are unaware that you have only 60 days to put money back into an IRA when transferring accounts, that's your problem, per the IRS. Plus, a rule change that took effect on Jan. 1, 2015, limits the number of 60-day rollovers to one per year for all of a taxpayer's IRAs in aggregate.

"There were a couple of cases (recently) ... where the people went for a special IRS ruling to see if they could get more time because they thought that the custodian, the bank, should have told them about the 60-day rule. (The IRS) ruled that no, that is not the custodian's responsibility," says Slott.

The 60-day rule is a little tricky if you don't know about it, and many individuals have no reason to be well-acquainted with the tax laws around retirement accounts. Not all financial professionals are experts, either.

"The average financial adviser is trained to sell investments; they are trained as salesmen. They are not trained on the intricacies of the tax rules," Slott says.

advertisement

Show Bankrate's community sharing policy
          Connect with us
advertisement
CD & INVESTING NEWSLETTER

Learn the latest trends that will help grow your portfolio, plus tips on investing strategies. Delivered weekly.

Blog

Jennie Phipps

6 steps to freedom from work

Celebrate Independence Day by considering your own plan to escape to retirement.  ... Read more

advertisement
Partner Center
advertisement

Connect with us