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We don’t charge an annual fee for maintaining an Ally Invest IRA account. There’s a $25 fee for terminating an Ally Invest IRA account, which is charged when all funds are removed from the IRA. If you make a full transfer out of your Ally Invest IRA account, there’s both a $50 transfer fee as well as the previously mentioned $25 termination fee. Partial account transfers have a $50 transfer fee.
The IRA contribution limit for 2021 and 2022 is $6,000 ($7,000 if you're age 50 or older at the end of the applicable calendar year). This amount is the total maximum for all your IRAs combined, not each one. There may be limitations to the amount you can contribute, based on your filing status and income. Contact your tax professional for questions about your contribution strategy.
Traditional IRA: An Individual Retirement Account (IRA) allows investors to deposit income, up to a specific annual maximum, toward investments that can grow tax-deferred (no capital gains or dividend income is taxed). Individual taxpayers are allowed to contribute 100% of compensation up to $6,000 ($7,000 for those 50 and over) to their traditional IRA, with no income cap affecting these contributions. Contributions to a traditional IRA may be tax deductible depending on the taxpayer's income, tax-filing status, and other factors. Ally Invest has no annual fees or maintenance fees for traditional IRAs. Review IRS Publications 590-A and 590-B for more information on traditional IRAs.
Roth IRA: A Roth IRA is a retirement account in which contributions are not tax deductible (contributions are made with post-tax dollars). Roth IRAs do allow for tax exempt distributions. Typically, funds must have been held in the account for a minimum of 5 years, and you must be over the age of 59 ½ to make a qualified distribution. There are, however, exceptions to these rules depending on your specific situation. Though you are allowed to contribute compensation up to $6,000 ($7,000 for those 50 and over) to a Roth IRA, there are income requirements you must meet in order to be eligible. If filing individually for 2022, if your earnings are $144,000 or more, you would not be eligible for a Roth. For those filing jointly in 2022, earnings of $214,000 or more are not eligible. (For the 2021 tax year these amounts were $140,000 or more for single filers and $208,000 or more for joint filers.) Incomes below these amounts are typically eligible for full or reduced contributions. Ally Invest has no annual fees or maintenance fees for Roth IRAs. Review IRS Publications 590-A and 590-B for more information on Roth IRAs.
Rollover IRA: A rollover IRA is a retirement account designed to facilitate the movement of holdings from a corporate retirement plan, such as a 401(k) plan. The rollover IRA is interchangeable with a traditional IRA. Contributions may be tax deductible depending on the client's income level, and the same $6,000 ($7,000 age 50 and over) contribution limit that applies to traditional and Roth IRAs applies to rollover accounts as well. Ally Invest has no annual fees or maintenance fees for rollover IRAs. Review IRS Publications 590-A and 590-B for more information on performing a rollover.
Coverdell Education Savings Account (ESA): A Coverdell Education Savings Account is a tax-privileged account designed for saving for education expenses. When the account is established, the beneficiary of the account must be under 18 or be a special needs beneficiary. Annual contributions to Coverdell ESAs are limited to $2,000, and those contributions are not tax deductible. Distributions are tax free as long as they are used for qualified education expenses and don’t exceed the amount of those expenses. Review IRS Publication 970 for more information pertaining to Coverdell Education Savings Accounts.
Modified Adjusted Gross Income (MAGI) Caps for Contributions
Traditional: There’s no income cap to contribute.
Roth: For 2022, single filers making less than $129,000 or joint filers making less than $204,000 may make full contributions; single filers making $129,000 to $143,999 or joint filers making $204,000 to $213,999 may make contributions at a reduced amount.
For 2021, single filers who made less than $125,000 or joint filers who made less than $198,000 can make full contributions; single filers who made between $125,000 to $139,999 or joint filers who made between $198,000 to $207,999 can make contributions at a reduced amount.
The easiest way to fund an IRA is through a bank (ACH) transfer. Once you open an account, you can link your bank account to your Ally Invest account by selecting Transfers and then Linked Bank Accounts. After you link your bank account, you can make contributions any time you want or set up an automatically recurring contribution.
You can also fund your IRA through a bank wire or by sending us a check. When funding by these methods, be sure to indicate the contribution year on your wire or check so we can properly label your contribution.
Lastly, you can contribute to an IRA by performing a transfer of cash from an existing individual or joint Ally Invest account. If performing a journal from a joint account to an IRA Account, the original IRA Contribution Form will need to be notarized and mailed to Ally Invest. Download the journal request form (PDF)
In an IRA, you can trade stocks, ETFs, mutual funds, and fixed income products such as bonds or CDs. Because industry regulations prohibit IRA accounts from having margin, short selling and selling naked options aren’t allowed.
You may also be able to make up to Level 3 option trades in your IRA. Depending on your approval level, you may be able to use strategies such as: covered calls, cash-secured puts, long puts and calls, spreads, and other multi-leg strategies. Review our Option Account Agreement and Application (PDF) to learn more about our requirements for trading options at Ally Invest.
For individual or joint accounts:
To change or add a beneficiary to a non-IRA Ally Invest account, complete the Beneficiary Form (PDF), have it notarized, and mail it to:
PO Box 30248
Charlotte, NC 28230
For IRA accounts: While opening an Ally Invest IRA account online, you’ll be asked to identify at least one primary beneficiary for your account. To update or change your beneficiary, complete the IRA Beneficiary Designation (PDF). Be sure to sign it, then upload it in the forms section after logging in to your account, or fax it to 1-866-699-0563.
An IRA Rollover is the movement of assets from a qualified retirement plan, like a 401(k) plan or 403(b) plan, to an IRA such as an Ally Bank IRA or Ally Invest IRA. Rollovers could be subject to tax consequences. Consult your tax advisor regarding frequency of rolling over funds.
An IRA Transfer moves funds directly from the trustee or custodian at another institution to the institution of your choice. For example, from a traditional IRA at your other bank into your Ally Traditional IRA.
Learn more about the different ways to move your retirement money around and about converting one type of IRA plan to another, such as traditional to Roth. You can also visit IRS.gov for more information on rollovers, transfers, and conversions.
You can set up your IRA as part of an Ally Invest Robo Portfolio, Self-Directed Trading account, or Wealth Management account.
If setting up as an Ally Invest Wealth Management account, let your advisor know that you'd like to roll over your 401(k) or 403(b) into an Ally Invest IRA. Your advisor will help you make the selection that’s best for you.
Here's a step-by-step look at how to roll over your existing 401(k) or 403(b) plan if opening as an Ally Invest Robo Portfolio or Self-Directed Trading account:
In the application, select Rollover IRA as the account type, or choose Roth IRA if your 401(k) or 403(b) is currently a Roth account.
Keep in mind, some 401(k) plans contain both traditional and Roth funds, and you may need to open both account types. If you're unsure how your 401(k) is allocated, ask your plan provider.
Contact the firm that's currently holding your funds, and request a direct or indirect rollover.
Understanding a direct rollover.
This is the most common type of rollover and is a direct transfer from your existing firm to Ally via wire or check. This could include issuing you a check made payable to your new IRA for you to deposit. No taxes are withheld from a direct rollover transfer.
Understanding an indirect rollover.
This is where your existing firm sends your funds directly to you via check or via wire transfer to your personal account. Once you receive the funds, you'll need to deposit them to your Ally IRA via wire or check within 60 days to avoid additional taxes and penalty fees. Keep in mind that for indirect rollovers, employers typically withhold 20% of your transfer amount for taxes. When the rollover is complete, the 20% is returned to you as a tax credit for the year.
Send funds to us by check or wire transfer. Your existing provider may transfer funds directly to us or mail you a check to deposit yourself. If they send funds to you, you can wire funds or send a check to us within 60 days of account opening.
Mail a check (payable to Ally Invest with "rollover" noted in the memo line) to:
P.O. Box 30248
Charlotte, NC 28230
Fill out the Bank Wire Request Form (PDF) OR provide the following information to the firm or bank making a wire transfer to us:
Routing number: 071000288
Bank account number: 3713302
Bank information: BMO Harris Bank
111 W. Monroe St.
Chicago, Illinois 60603
Name on bank account:
Apex Clearing Corp
One Dallas Center
350 N. St. Paul, Suite 1300
Dallas, TX 75201
For further credit to: [Fund holder's name]
For further credit account: [Fund holder’s 8-digit Ally Invest account number]
Keep in mind:
- We don't allow incoming or outgoing international or third party wires.
- If you don't include "For further credit to" with the fund holder's Ally Invest account number and name, we may need a statement from the fund holder's firm which could delay the deposit.
- Initial funding via wire transfers of $5,000 or more is eligible for reimbursement of related wire transfer fees ($25 maximum). This doesn't apply to retirement accounts. This is a one-time credit for the first deposit, and no subsequent deposits will qualify.
Fill out and send an IRA Deposit Slip (PDF) to Ally Invest. To upload from your account, choose Investment Accounts, select Document Upload, then browse files to attach the slip, and select Upload. You can also mail it to us (same address as listed in step 3), or fax it to us at 866-699-0563.
Your funds are ready to invest as soon as they're rolled over. Though it varies, this typically takes up to 2 weeks. They'll appear in your account the same day we receive the check or wire.
You can fund your IRA using any of our Ally Invest accounts:
- Robo Portfolio
- Wealth Management
If you're closer to retirement, you may want to consider one of our Ally Bank IRA options instead. They're FDIC-insured and better suited for the shorter term with more consistent returns.
We offer the following Ally Bank IRA accounts:
- IRA High Yield CD
- IRA Raise Your Rate CD
- IRA Online Savings Account
It depends. Minimum distribution rules changed in 2020. If you have a Traditional or SEP IRA and you turned 70 ½ in or before 2019, you’re required to take a minimum distribution. But if you were born after June 30, 1949, you may not need to yet. In this case, the IRS requires that you take an annual minimum distribution by April 1 of the year following the year you turn 72. The amount of your distribution depends on how much you have in your account divided by your life expectancy. Check with the IRS or your tax professional for more information on how to calculate your distribution amount.
If you have a Roth IRA, you don't have to take an annual minimum distribution, so your money can grow until you need it.
If your IRA contributions exceed yearly contribution limits, remove the excess amount before the tax filing deadline of April 18, 2022, (April 19, 2022, for residents of Massachusetts and Maine) to avoid a possible 6% penalty.
The fastest way to withdraw money from an IRA account is to log in to your account, select Transfers, then Invest Transfers, then fill out the provided form and upload online.
We strongly suggest you consult with a licensed tax professional to determine how to correct any excess contributions before submitting your request.