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Old February 11, 2020, 15:45   #1
raubvogel
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Moving money to another investment account

So I have had some money in an investment company and had been doing ok, but now I would like to move the money in that account that is currently not invested into another. Would that incur a penalty with the IRS since right now I would have to move it to my bank account and then to the new investment account? Is there a way to avoid such penalty?
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Old February 11, 2020, 17:34   #2
Bawana jim
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Is it your 401 k?
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Old February 11, 2020, 17:46   #3
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If you are taking the money from a tax deferred retirement account you should transfer it directly from that account to the other. If you deposit into your bank you will incur a penalty and have to pay tax. You can have the manager of the account you want to transfer into arrange to transfer the funds.
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Old February 11, 2020, 18:31   #4
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If this is an IRA or 401K, they will withhold 20% in taxes if you put it in your bank account. You will have to come up with the 20% out of pocket to make up the difference. Then when you file you get the 20% back. If you are under 59 1/2 and you don't make up the 20% then you will be penalized another 10% on that 20% along with tax as income.

You need to get your ducks in a row and do a direct rollover. On mine the check was sent to me but it was made out to my IRA account. I sent the check then to the account.
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Old February 12, 2020, 00:11   #5
Scout10
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If you establish this "new" IRa investment account first. The holder of
the "new" account will have you complete a transfer form W/ signature.
Your transfer can be done without any "withdrawl".
simple !

This will only work if you are moving from old IRa / 401 to new IRa.
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Old February 12, 2020, 05:19   #6
raubvogel
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It seems I forgot to mention an important point, but what you have said applies to a retirement account I have which is only making 6% vs the (last year) 20+% of my other retirement account.

This just an investment account, not retirement, hence the title. I just put there money that is sitting doing nothing. If you are still curious, I do not mind telling it is lendingclub.com; a microloan kinda thing. Recently they decided residents of many states, including the one I live and have lived on, cannot invest anymore buy "shares" on loans anymore, instead having to trade them in their secondary market which is a completely different company requiring a completely different account. So, the return I have earned for the last few months has been sitting and that annoys me. I plan on moving that specific money somewhere else, and keep on doing that until they figure themselves out.
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All I'm really asking for here is a knife that will not jam and a unicorn that doesn't need sharpening. Will_Power
It's been my experience that all you really need to harvest a deer is a car. They come right through the windshield just fine. 357ross
That poop is priceless. MFC
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Old February 12, 2020, 18:03   #7
Scout10
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If the money "sitting" is in an "investment" account. ( after taxes) that you receive a 1099 from for annual taxes. You can do what you want with ALL
of it, or just the dividend / profit / yield, your choice.

Invest it in same account or establish another with more flexibility / options.
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Old February 12, 2020, 18:34   #8
meltblown
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ANy gains will be subject to taxes if you cash it out. If it is just money sitting there that hasn't seen any gain or loss, then you can pull with no worries. Basically, it's money in a wallet that resides in the account. No different than having idle cash in a brokerage account that never was allocated into an investment.
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Old February 12, 2020, 18:47   #9
yellowhand
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Walk into Bank of America,, and ask them,,,its what we did,,,end result,,no penalties,,transfers happened,, they even handled everything for us.

Banks keep up with all this stuff.

Crap is complicated and getting worst daily.
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Old February 12, 2020, 20:47   #10
meltblown
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Quote:
Originally Posted by yellowhand View Post
Walk into Bank of America,, and ask them,,,its what we did,,,end result,,no penalties,,transfers happened,, they even handled everything for us.

Banks keep up with all this stuff.

Crap is complicated and getting worst daily.
Yes it's getting too complicated. And no, you need to figure it out for yourself. It's money. I don't want to be relying on someone else's opinion like BOA
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If you're looking for someone loyal, get a dog. Otherwise you're not going to find it.

Expect the worst, and you'll never be disappointed.

Before trying to beat the odds, make sure you can survive the odds beating you.
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Old February 12, 2020, 22:56   #11
yellowhand
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Quote:
Originally Posted by meltblown View Post
Yes it's getting too complicated. And no, you need to figure it out for yourself. It's money. I don't want to be relying on someone else's opinion like BOA
I can balance a check book,,,beyond that,,,rely upon others with far more brains for money than I have.

We've done really well over past 48 years,,,,but,,,,,,I also never put everything in one basket either.

This past three years has been great,,,,,,,,for some reason.
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