Combining Roth IRA and Roth Conversion

[Guest SteveS]

On 3-4-99 I converted a Trad IRA (bank CD) to a Roth IRA.

On the same day, I also made a deposit (bank CD)to a Roth IRA. (they said I couldn't combine a Roth conversion with the regular Roth). Both CD's mature on 3-4-2000.

So, on 3-4-2000 can I combine those 2 CD's into one CD ?

SteveS

[This message has been edited by SteveS (edited 02-28-2000).]

[This message has been edited by SteveS (edited 02-28-2000).]

[This message has been edited by SteveS (edited 02-28-2000).]

[John G]

When Roths were first created, there were technical issues that had everyone assuming that you had to keep conversions and contributory accounts separate. After a series of techinical clean-ups and IRS rulings, the current rules do not require segregated funds. Your custodian should know that by now. If they don't, buck you question to a supervisor or the IRA dept. and if that does not work, try a different custodian.

You might want to consider some of the mutual fund options that involve bonds. Lots of choices in that area, a range of risks and annual returns. You won't have the government guarantees however.

[Guest SteveS]

3-4-00. Just got back from my bank. They said NO. My contributions and my conversions can NEVER EVER be combined. So much for the paperwork reduction act.

I'll check back with them on Monday. Their Saturday employees aren't too sharp.

[BPickerCPA]

The Monday through Friday ones are always the sharpest knives in the drawer either.

You may want to move the accounts to another bank, that will let you combine them. IF you do, let the old bank know why you're moving.

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Barry Picker, CPA/PFS, CFP

New York, NY

[Guest SteveS]

I've spent several hours searching the IRS announcements and the "Reform Act" trying to find the section pertaining to my situation. (thought I'd take a copy with me)

I considered applying for a job as a IRA specialist, but I figured I would then be the dim bulb.

Thanks guys.

SteveS

[John Olsen]

If your bank's employees are that ignorant of the BASICS of IRAs (as John said, the reasons for not combining "regular" and "conversion" Roth accounts were eliminated long since;they should have gotten the word by now), ....

... just IMAGINE how they'll perform when it comes to something really COMPLICATED.

Alas, this institutional boneheadedness seems to be almost commonplace. Some IRA Custodians insist that "the law" REQUIRES what some functionary decided upon as bank POLICY, MANY will refuse to acknowledge a simple "per stirpes", in the beneficiary designation. MOST of the Custodians I surveyed would NOT allow an IRA beneficiary to name his or her own beneficiary.

I believe there's a great opportunity here, for some savvy institutional custodian that is willing to act as a FIDUCIARY.

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John L. Olsen, CLU, ChFC

Olsen Financial Group

St. Louis, MO

314-909-8818

[Guest SteveS]

It is "bank policy" to keep contibutions and conversions separate. Something to do with the bank's reporting system.

hmmmm. . .

[John G]

"Bank policy" - - perhaps because they charge a fee for each account? Time to buck this up the chain of command. I would not have an account with a bank whose focus is not on their customers wishes but rather their internal administrative rules... that lack no IRS basis.