expired cd's in a IRA?

[mingdurga]

NY

My CD expires in 1 week ( IRA account). Can I re-invest in another CD for tax year 2011 and deduct the amount on my tax forms for 2011? Same bank.

 

[anteater]

No. Even though the CD is reaching maturity, the funds are still in the IRA account. You are not making an IRA contribution by re-investing in another CD.

An analogous example:

I have an IRA account at a brokerage firm. I hold IBM stock in the account. I decide to sell the IBM and buy some Apple. I have not made a contribution to the IRA account and can't claim a deduction. I am just rearranging the deck chairs within the account.