USING ROTH MONEY

We are closing very soon on a home purchase and will then put our current mortgage free home on the market after our move. We would like to keep this an all cash purchase, however until our current home sells we are considering a 60 day rollover from my Roth IRA. If more than 60 days is needed, we could consider another 60 day rollover from either my wife’s Roth or her TIRA. Her money is approximately split 50-50 between her two accounts. In this case we would need the money from both of her IRAs. Charles Schwab told me she can only roll from one, not both of her IRAs. This might require a Home Equity Loan or that I make part of my Roth rollover a distribution. My two questions (1) Is Schwab correct on only allowing one IRA rollover for my wife? (2) Our Real Estate Agent referred us to a Loan Agent who of course is eager for our business and is not favorable to our self funded approach to this purchase. So my second question, Is my plan to use Rollover money a bad or unsound decision, or might you steer me in a different direction? Thanks so much in advance for your helpful guidance. CW



An individual can do one 60-day rollover per a rolling 12 month period.  It doesn’t matter how many accounts are in play.



  1. Yes, Schwab is correct. Each spouse can only do one 60 day rollover within a 12 month period.
  2. Taking a distribution and hoping to meet the 60 day deadline when a real estate closing is involved is very risky and often ends badly with a taxable distribution, and while the Roth distribution should be tax free unless Roth earnings are tapped, you would still lose valuable Roth assets which otherwise will generate tax free gains for life with no RMDs. And even if you were able to each complete a rollover, as the 60 day deadline grew closer it would be very stressful. 
  3. Note that if you assume this risk and wife is still working and has a qualified plan that would accept IRA rollovers, she could get around the one rollover limit between IRAs by using the rollover for her Roth distribution, and rolling the TIRA distribution into the employer plan because the rollover limit only applies to rollovers between like kind IRAs, not to rollovers into a non IRA plan. 


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