60 day shelter – multiple accounts- cascading
Is it possible to cascade funds using the 60 day shelter and borrow indefinitely (given enough separate IRA accounts, i think you would need 7 accounts, and therefore could borrow 1/7th of total) ?
Is it possible to cascade funds using the 60 day shelter and borrow indefinitely (given enough separate IRA accounts, i think you would need 7 accounts, and therefore could borrow 1/7th of total) ?
Permalink Submitted by Alan Spross on Thu, 2012-09-06 16:51
Yes, it is possible and frequently done.
At some point the IRS could consider this a disallowed step transaction, but I have not heard of this happening yet. Under that theory, the IRS would have to show that the rollovers were not done in the process of changing custodians, but that the funds were actually used as part of a borrowing strategy from your IRA.