Combing tax-deferred asets

[maxtiel]

Hi. I am new to the site, and live in Maryland, having recently moved from Virginia.

Question regards three assets I have: 1) a 401k from an employer I left >10 yrs ago, 2) a traditional IRA, and 3) a SEP-IRA. I have kept these 3 assets separate for a long time. Do I need to continue to keep them separate? My sense after reading a slew of IRS pubs is that the IRAs can be combined, but I am less sure of the 401k.

I'm asking because I have started investing these assets in a vehicle that will charge me about $200/year for each account. Thus, having 1 versus 3 accounts amounts to a difference of $400/year.

Many thanks.

[Snipes5]

$200 a year per account is a LOT of money. I hope those accounts are large. If not, you are being ripped off.

You can roll a 401K into a Traditional IRA if you like.

You MAY be able to roll Traditional/SEP IRA funds into a 401K depending on the rules and administration of the fund.

For example, those with a TSP account (Essentially a Government 401K) can roll funds from other tax deferred accounts into it at any time. If your fund allows that, then you can do it.

Snipes

[maxtiel]

Snipes, thanks so much. They are good amounts of money, and given the role of the administrator, I am okay with the fees. That said, I'd just as soon save $400/year.

From what you said, can I combine all them into one IRA account, whether it be traditional or SEP? If so, and considering that the contribution (ie transfer) to that one IRA account from the other two accounts exceeds the maximum annual contribution limit, am I okay with that limit since the transfer is funds that are already tax-deferred as opposed to newly tax-deferred?

[Snipes5]

You can probably roll them all into a SEP provided you are still employed in the place that established the SEP, whether yours or your employer's. You will want to check with the details of the plan to make sure they allow rollovers into the plan.

Transfers do not affect the yearly maximum contributions so you are okay there.

Snipes

[maxtiel]

Thank you again, Snipes.

I am employed with the company through which I have the SEP (I am one of two 50% owners; an S corporation). All we did to establish the SEP in 1994 was complete IRS Form 5305-SEP. I've just reviewed that form, and find no language addressing the issue. I gather from what you say I need to check with the institution holding the SEP monies (i.e., the one wanting to charge $200 per account), and abide by their ruling on combining all the funds in to my SEP. Yes?

Just curious, what is your background?

[Snipes5]

Yes, the administrator should be able to give you that information.

I am an Enrolled Agent.

Snipes

[maxtiel]

I will check with the plan administrator. You've simplified my life, and saved me some money! Many thanks, Snipes.

[Snipes5]

You're very welcome.