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I am retired and 60 years old. In a self directed ira with bank cds, can I cash the cds with no penalty?

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Question by CLASSACT: I am retired and 60 years old. In a self directed ira with bank cds, can I cash the cds with no penalty?
Yes the IRS will count the cashed cds as income. But will a bank allow a self directed ira to cash cds whenever without bank penalties?
Good News!!

My bank said they can set 2 “Self Directed IRAS” up for me and I can cash cds from the CD only IRA into the other IRA which will be a Money Market IRA that i can draw from freely! CDS can be cashed freely anytime in the one and the money transferred all without fees or penalties! Of course any cash taken out of the Money Market iRA will be subject to income taxes. SO it is going to work without having any normal cd penalties :-)

Best answer:

Answer by ninasgramma
The IRS does not have any rules about this. Waiving the penalty would be the option of the bank. Some banks waive early withdrawal penalties for minimum distributions, certain rollovers, etc.

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Kihei Bay Surf #130
self-directed IRA

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Kihei Bay Surf #130, Maui, Hawaii. Self-directed IRA real estate investment. Interior design by Barbara Armstrong, creativehomeremedies.com.

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  • Judy

    No, CD’s will incur a penalty if you cash them early, even if they are in a self directed IRA

  • Yoda

    Maybe this is a question better asked at the bank or what ever financial institution you deal with to get a factual and informative answer ,,,,

  • bud68

    If the CDs haven’t matured, there will likely be an interest penalty whether or not they are in an IRA account. Ask the bank.

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