What is a prohibited transaction?
A prohibited transaction occurs when an IRA owner uses IRA assets in a self-serving or self-dealing manner that improperly benefits the IRA owner.
It may be a prohibited transaction anytime an IRA owner or beneficiary has a self-directed IRA account invested in a business in which the account owner also engages outside of the IRA, has unexplained large deposits or balances in the IRA, or funnels business expenses or income through a Roth IRA.
What is a Roth IRA conversion?
A Roth IRA conversion is the process of moving IRA or employer plan assets to a Roth IRA.
1. When will you need the money? If you have an immediate need for the funds or need them to continue your current standard of living, then a Roth IRA conversion is probably not for you. However, if you have no immediate need for the funds, a Roth IRA conversion is potentially a great way for the funds to grow tax-free over your lifetime.
Retirement planning mistakes can be costly. Seek the help of a financial planner or tax attorney to achieve the goals for a comfortable and stress free retirement.
1. Not Having a Plan
Do you know how to achieve the retirement lifestyle you want? Consider these three things.
- When do you want to retire?
- How much income will you need?
- What steps can you take not to help you achieve your goals?
When you have defined your goals, we can develop a financial plan to reach them.