Conversion to Brokerage Account

You are here:
< Back

L1: Conversion to Brokerage Account
Currently in third year of SEPP plan. Would like to convert the standard IRA mutual fund account to a brokerage account (at Vanguard) and, in turn, exchange some of the funds therein to ETFs. No withdrawals/additions, just conversion. I’m questioning whether these actions would have any effect on the SEPP in the eyes of the IRS. Wouldn’t think so, yet you do create an entirely new account in the process. Thanks for your help!
2018-01-10 22:53, By: Gary, IP: [96.241.158.14]

L2: Conversion to Brokerage Account
Conversion is not a problem, and the brokerage account will allow you to purchase ETFs, brokered CDs and other investments that you were not able to access before without doing a partial transfer, which poses a small amount of risk. The change to the brokerage account will be a full non reportable transfer (no 1099R) and that does not add any risk whatsoever to your plan. The change of account number showing on the 1099R reporting your SEPP distributions should not result in any IRS concern.
2018-01-11 00:20, By: Alan S, IP: [24.117.172.15]