financial planning expenses
Can we pay financial planning fees from an IRA? For example,the fee to determine if a Roth conversion should be done?
Many thanks as always …. Mary
Can we pay financial planning fees from an IRA? For example,the fee to determine if a Roth conversion should be done?
Many thanks as always …. Mary
Permalink Submitted by Alan - IRA critic on Mon, 2015-06-22 19:17
Yes, advisory fees can be deducted directly from the IRA and this is not reported as a distribution, nor can the fees be deducted on Sch A itemized deductions. Fees should be deducted from TIRA and Roth IRAs in proportion to their relative balances, but conversion planning fees can be deducted from the TIRA as they were incurred prior to the Roth. That way, the fees are effectively paid from pre tax dollars.
Permalink Submitted by Mary K. Dean on Mon, 2015-06-22 22:46
Many financial planners do financial planning beyond investments yet only charge AUM fees. Can the AUM fees still be deducted in proportion to relative IRA balances?Many thanks as always …. Mary
Permalink Submitted by Alan - IRA critic on Mon, 2015-06-22 22:54
Yes. Note that I edited former post to differentiate between paying the fees directly from the IRA and itemized deductions which are allowed when fees are paid from taxable funds, but not when the fees are paid directly from an IRA.