Can stock be transferred to an IRA?

September 23, 2005

Date:  Thu, 25 Aug 2005
From:  Gayle

Dear Mr. Gray,

I was at your website last night and was hoping I might ask you an IRA question.

My husband transferred some shares of stock received in a class action suit as an IRA contribution.

My broker tells me that stock can't be transferred to an IRA. Is there an exception to this rule? I have a few shares of stock that I also would like to contribute to my IRA.

Thank you,
Gayle

Answer

Date:  Wed, 14 Sep 2005

Hello Gayle,

IRA contributions must be made in cash. (Internal Revenue Code Section 219(e)(1).)

The only exception is that when property is received as a distribution from an IRA that is later rolled over to another IRA, the property must be rolled over intact. (Section 408(d)(3)(A)(ii).)

Good luck!
Mike Gray

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Michael Gray, CPA
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