Asked 10/5/2010
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This is a follow-on to my previous question regarding "two" IRA's. I wonder if indeed that I have two separate IRS's. Monies were taken from my IRA to purchase an annuity. I recently received notification from the annuity company regarding the need for a MRD. As the annuity is earning more money than the IRA I wish to not withdraw from the annuity. Can't I withdraw the total from the original IRA as the annuity was purchased using the IRA money. It would seem to me that I really do not have two separate IRA's. Your response would be appreciated. Thanks. |
Answer 1/2 - Submitted 10/5/2010
Two things you can look at or think about --
First is the paperwork for the annuity. Sometimes it will be titled "IRA FBO John Smith," and sometimes you have to look over the contract for the letters "IRA."
The second is the tax return from the year you opened the annuity. If you remove money from an IRA, you have to pay tax (and sometimes penalty) unless you roll it into another qualifying retirement vehicle. So ... did you pay tax on that money? If not, the annuity is probably part of an IRA.
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