Dear Tax Talk,
My IRA is held in a Fidelity account. However, Fisher Investments manages it, making all the trade decisions and executing the trades. I have no direct control over the account.
Fisher charges me a percentage of the balance quarterly. Can I
have the Fisher asset management fees paid directly from my IRA to
Fisher Investments without paying taxes on it as a distribution?
Thanks, and best wishes.
Yes, you can have the asset management fees paid directly from your IRA account and it will not be taxable to you as a distribution. This is because advisory funds drawn from a retirement account are considered a tax-free withdrawal from the account.
However, you may want to take some time to go over another option available to you whereby you pay those asset management fees from funds held outside of the IRA, as this may generate a tax deduction for you.
You should sit down and go over which situation is going to work best for you, as you can see there are several variables involved. I think you will find it time well-spent. Be sure to revisit the issue every year as it should be looked at on a year-by-year basis rather than a one-time decision.
Thanks for the great question and all the best to you.
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