The Slott Report

IRS recently completed a SEP plan compliance project and found errors by both the SEP employer and by the financial institution filing SEP contribution information. Below we outline the errors made by the employers and the financial institutions.

This week's Slott Report Mailbag answers your questions on IRA rollovers, the Roth conversion conversation when dealing with Social Security benefits as added income, and inherited IRAs. We answer situational questions asked by individuals, couples, and parents who are searching for the best way to leave an inherited IRA to their daughters.

A recent report released by the Center for Retirement Research at Boston College shows that Social Security is one of, if not the cheapest annuities available (click here to see the report). "Well that doesn't make much sense" you might be saying to yourself. After all, you don’t "buy" your Social Security annuity payments right? You're simply entitled to receive them after meeting certain requirements.

The IRS announced that it reached a financial settlement with an accounting firm that promoted illegal tax shelters, some of which involved Roth IRAs. BDO USA LLP was fined $34.4 million dollars for its part in promoting and not reporting various tax shelters over seven years. Some of these abusive tax shelters involved the use of Roth IRAs.

The New York Times ran an article on June 13th titled, "Using Your 401(k) to Buy a Small Business," and we feel compelled to discuss the piece and provide a few words of warning on using what is called a ROBS (Rollovers as Business Start-ups) transaction. Ed Slott goes through the article and adds his own expert retirement planning perspective in this IRAtv video below.

A recent report released by the Center for Retirement Research at Boston College shows that Social Security is one of, if not the cheapest annuities available (click here to see the report). "Well that doesn’t make much sense" you might be saying to yourself. After all, you don’t "buy" your Social Security annuity payments right? You're simply entitled to receive them after meeting certain requirements.

The law allows you to leave money and property to a beneficiary after your death. Generally, the beneficiary must be a person or legal entity capable of accepting the property. Individuals almost always name a beneficiary of their IRA who will inherit the funds after their death. Usually the IRA beneficiary is a person such as a spouse, child, or grandchild. But IRA owners can name a legal entity as their IRA beneficiary, such as a charity, estate, or trust.

We received an IRA mailbag question from Greg, who wanted to know if he could consolidate all of his separate converted Roth IRA funds into one account. Two important factors to answer this question are: 1) how long have the converted funds been in the Roth IRA? 2) how old is Greg?

Happy Friday! So, let's say you are leaving or have left your employer. What happens to your retirement plan funds? There are options other than taking a taxable distribution of your retirement account balance.