Q. I have a SIMPLE-IRA, while my husband has a SEP-IRA and a traditional IRA. We’re both in our 50s. Can we consolidate these into traditional IRAs? B.R.M., Sioux City, Iowa
A. Yes. Your husband can shift funds from a SEP-IRA to his traditional IRA through a rollover. No tax withholding is required if a trustee-to-trustee transfer is used.
Similarly, you can roll over funds tax-free from a SIMPLE-IRA to a traditional IRA. But you must have been participating in the SIMPLE for at least two years. Otherwise, the transfer will be treated as a taxable distribution.
Tip: Consolidating accounts may make it easier for you to coordinate retirement plan investments.
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