Typically, if you have earned income of at least that amount in the given tax year, you may contribute up to $5,500 ($6,500 if over 50 years old) for 2013.
This is currently not available.
Yes, Entrust needs that in the event something would happen to you to distribute the funds.
Loaning money from your IRA is as simple as creating a promissory note with the loan terms, such as the amount, duration, interest rate, whether it is collateralized, etc., and ensuring that the person to whom you are loaning funds is not disqualified. That is, the person you are loaning funds to is neither a fiduciary to the IRA nor a lineal ascendant or descendant, including their spouses.
To access your account(s) online and view statements you must first create a new user name and password. Please follow this link to create account.
Each has its specific form which is fundamental (though other forms may be needed in conjunction with them depending on specifics of that transaction). Please follow this link to view forms.
Typically, the transfer of funds can take anywhere from 2-4 weeks depending on the custodian and how quickly they will send the funds over to Entrust. To help expedite the process, the client should notify their current custodian of their intentions and request for them to process the transfer upon receipt.
The rules of RMDs apply to:
The rules also apply to Individual(k)s with Roth option, but do not apply to Roth IRAs.
The RMD is calculated for each account by dividing the balance of the account on December 31 of the year prior by the life expectancy factor published in IRS Publication 590, Individual Retirement Arrangements.
If your spouse is your sole beneficiary, or your spouse is more than 10 years younger, use the Joint and Last Survivor Table.
If your spouse is not your sole beneficiary, or is not more than 10 years younger, use the Uniform Lifetime Table. If you are the beneficiary of the account, use the Single Life Expectancy Table.
Establishing an Individual Retirement Account (IRA) with The Entrust Group requires a $50 set-up fee. An annual fee is then assessed based on the option that you choose to enroll in:
The Entrust Group is responsible for maintaining the record keeping for your account, along with the required tax reporting. In order for individuals to invest in non-traditional investments (real estate, promissory notes, etc.), it is necessary that you utilize a company who handles self-directed accounts. You will find that other traditional institutions, such as banks, do not typically allow you to make investments in alternative assets. These institutions generally limit you to investing in stocks/bonds, mutual funds, money market accounts, and IRA CDs. Opening an account with Entrust allows you the opportunity to invest in alternative assets.
Once the Distribution Form is submitted for processing, the funds are issued within 2-3 business days. How quickly you receive the funds will depend on the delivery method you select. Your options are to have a check mailed, send funds by wire or ACH, or have them distributed onto your myDirection Visa® Card. For more information please visit The Entrust Group myDirection Visa® Prepaid Card page.
You should receive your card from Citibank within 7-10 business days.
I have heard of a variety of investments, which run the gamut between real estate and precious metals. I particularly like hearing about clients who invest in areas that reflect the client’s interests. For instance, we’ve seen investments in teak wood, coconut groves, ATM machines, a cattle ranch, and even a tanker ship of vegetable oil that was sold once the ship arrived.
When you call in, it is advisable to have your account number readily available. This is the first thing that a Client Services Representative is going to ask for when trying to access your account information.
Also, if a third party is calling on your behalf, they should know in advance if they are listed as an Interested Party Designation (IPD) or Power of Attorney (POA) on the account. If you have not listed the individual on your account, the information will not be released. This is applicable for spouses as well. If you would like for your spouse to have access to the account information, they will need to be listed as the IPD or POA before we are able to speak with them about the account information.
If we didn’t answer one of your questions, or if you are interested in learning about how to open an account, please reach out to us today at 1-800-392-9653.
A recharacterization is a mechanism that allows a taxpayer to move a current year’s contribution from one type of IRA to a different type of IRA. This transaction is not taxable and must be completed prior to the tax return due date, including extensions. In most cases, the deadline is Oct.15.
Example: Joe contributes $5,500 to his Traditional IRA expecting that the contribution may be used as a tax deduction on his individual tax return. Later, Joe is notified by his accountant that he is not eligible for a tax deduction. However, his accountant advises Joe that his income allows him to make a Roth IRA contribution. To maximize his benefit, Joe decides to recharacterize his current year annual contribution from the Traditional IRA to his newly established Roth IRA. In doing so, Joe is not only able to move his Traditional IRA current year contribution, but also move the earnings earned on the contribution to the Roth, as if the contribution was originally contributed to the Roth IRA.
You are not required to recharacterize the full contribution. A taxpayer may recharacterize a portion of a contribution. Since the earnings or loss associated with the amount must be recharacterized, the proportionate percentage of earning or loss must be moved along with the contribution.
Example: Mary makes a contribution of $4,000 to her Traditional IRA. She can only use $2,000 of her contribution as a tax deduction. Mary is eligible to make a Roth contribution. She decides to recharacterize the portion of her contribution that may not be used as a tax deduction to a Roth IRA, which is $2,000. The total earnings on her Traditional IRA at the time of the recharacterization is $200. Mary must not only recharacterize the $2,000, or half of her contribution, she must also recharacterize $100, or half of the earnings.
Here are two examples of tax payer benefits.
Example 1: On July 1, a taxpayer converts his Traditional IRA, worth $500,000, which is invested in real estate. He conducts the conversion in-kind, meaning the real estate will not be sold but merely retitled to the Roth IRA. The taxable amount for the conversion will be the fair market value of the real estate worth $500,000, with taxes payable by the his tax return due date, along with approved extensions. In August of the same year, the real estate market drops and the value of the home is reduced to $350,000. The taxpayer decides to reverse the conversion via a recharacterization and retitles the real estate back to the Traditional IRA. The administrator shows the recharacterization to the IRS and the taxpayer using the government reporting forms that were filed and mailed at the end of the year. The following year, the taxpayer decides to reconvert the same real estate on Jan. 1, which is now worth $350,000. His taxable amount for reconverting the same piece of real estate in this conversion will be $350,000, since he recharacterized his initial conversion.
Example 2: A SIMPLE IRA owner has been contributing for eight months. Without knowing the rules, he transferred his SIMPLE IRA assets to his Traditional IRA at another administrator to consolidate his investments. He was told later by his CPA that this was a violation of the rules. To correct the error, the taxpayer may recharacterize the Traditional IRA assets back to the SIMPLE IRA – as if the transaction never transpired. The administrator, at the end of the year, will report the transactions to the IRS and the IRA holder.
To learn more about recharacterizations, or about investing in alternative assets, contact any of our offices to speak with one of our knowledgeable IRA specialists.
According to IRS publication 590, disqualified persons to your plan include:
If you hold more than one asset within your self-directed account, please complete one form for each asset. Also, each form must be sent back with supporting documents. For real estate assets, that may include a real estate fair market value analysis, more commonly referred to as a comparative market analysis (CMA). This is a detailed report examining the homes currently on the market, under contract, recently sold and recently expired, withdrawn or canceled. It determines what a property is worth in the current market. For investments that you may have deemed “worthless” or “lost,” contact Entrust for questions specific for your account. If these assets are to be removed from your account, indicate the status and value on the Fair Market Valuation Form and sign it yourself. In this instance, you will not need a qualified, independent professional to perform the valuation. You will, however, need to provide documents that will support the status and value to remove them from your account. These can be: