Ask Tax Question

I am considering transfering a Simple IRA account to my son's 529 education account. Am I subject to the 10% penalty if all of the money is not spent at once?

Simple IRA
Are You A Tax Professional? Answer This Question

Tax Professional Answers

User Photo
John Stancil
You can't do a rollover of the IRA into the 529. It would be treated as a distribution from the IRA and subject to income taxes, and possibly an early distribution penalty. In addition, you may be confronted with the contribution limits for the 529 plan.
Leave a Comment 73 weeks ago

User Photo
Question Owner
I understand that I would be subject to incomes tax on the distribution. Do I need to contact the IRS to determine if I am subject to the penalty?
Reply 73 weeks ago
User Photo
John Stancil
I would not contact the IRS, you are not likely to get a straight answer. Talk with your tax or financial advisor. The answer depends on your age and other issue. You may be able to avoid a penalty by withdrawing up to $10,000 and use that amount for education expenses.
Reply 73 weeks ago

Meet Leading Tax Advisors

User Photo Kathryn Morgan

Bossier City, Louisiana, USA

Enrolled Agent, Master Tax Advisor

User Photo Peter J. Scalise

New York, New York, USA

Federal Tax Credits & Incentives Practice Leader

User Photo John Stancil

Lakeland , Florida, USA


User Photo Steven Potts

Fullerton, California, USA


User Photo Devon McCarthy FCCA, EA

Sanford, Florida, USA


User Photo Robert Ferguson

Tucson, Mesa, Arizona, USA


User Photo Lisa Nason

Greenville, South Carolina, USA

Managing Shareholder

User Photo Gary Carter, PhD, MT, CPA

Edina, Minnesota, USA


User Photo Bill Robinson, CPA

Chattanooga, Tennessee, USA


User Photo Hugo Van Zyl

Stellenbosch, South Africa

Exchange Control & Master Tax Practitioner (SA)

User Photo Caran Ebert, CPA

Topanga, California, USA


User Photo Douglas Stransky

Boston, Massachusetts, USA

Tax Partner, International Tax

User Photo Larry Stolberg, CPA, CA

Toronto Mississauga Oakville Burlington Hamilton, Canada

Tax Specialist

User Photo Jorge Otoya

Cleveland, Ohio, USA


User Photo Gerald Nordland

Phoenix, Arizona, USA


View/Select our Current List of Tax Topics

# A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Previous PageNext Page

Contact Us Today