Moving money between IRA accounts involves either a direct transfer or a rollover, each with different rules and tax implications. A direct transfer is the simplest method: contact your new IRA custodian (bank, brokerage, or investment firm) and request a transfer. They'll handle the paperwork to move funds directly from your old custodian to the new one, avoiding any tax withholding or 60-day deadlines. This method is recommended whenever possible.
Alternatively, you can perform a rollover by withdrawing funds from your current IRA and depositing them into another IRA within 60 days. However, rollovers are riskier—if you miss the 60-day window, the IRS treats the withdrawal as a taxable distribution, resulting in income taxes and potentially a 10% early withdrawal penalty if you're under 59½. Additionally, you can only perform one rollover per IRA per 12-month period, so multiple rollovers in a short timeframe may violate this rule.
Important considerations: Ensure both accounts are the same IRA type (Traditional to Traditional, or Roth to Roth) unless you're intentionally performing a conversion, which has specific tax rules. If your IRA holds employer stock or highly appreciated investments, understand how the transfer affects those positions. Also confirm there are no pending loans or complicated assets that might complicate the transfer.
Before initiating either process, review your current IRA's fee structure to understand any transfer or closure fees, and verify your new custodian doesn't charge inbound transfer fees. The entire process typically takes one to four weeks with a direct transfer.