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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 2019 is $6,000 or $7,000 if you’re age 50 or older at the end of the calendar year. For 2018, the limit is $5,500 or $6,500 if you’re age 50 or older at the end of the calendar year. 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. 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. There are also income requirements which must be met to be eligible for a Roth IRA. As of 2020, if you file individually and earn $139,000 or more, you would not be eligible for a Roth. If filing jointly, those earning $206,000 or more would not be eligible. 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.
|Traditional IRA||Roth IRA|
|Contribution limits||Currently $6,000 with a $1,000 catch up clause for clients 50 or older as of the contribution year||Currently $6,000 with a $1,000 catch up clause for clients 50 or older as of the contribution year|
|Contribution Age Limit||No age limitations on contributions.||No age limitations on contributions.|
|Income Caps for Contributions||No income cap to contribute.||Make a full contribution if Adjusted Gross Income (AGI) is less than $196,000 if filing jointly or less than $124,000 if filing individually.|
|Tax Consequences for Earnings||Gains grow on a tax-deferred basis. For tax purposes, earnings are added to income for the year distribution is taken.||Gains grow tax-deferred. Qualified distributions aren't taxed, including earnings.|
|Deductibility||Contributions may be deductible, depending on income level and participation in a Corporate Retirement Plan.||Contributions are not deductible; they're considered to be post-tax contributions.|
|Distribution Regulations||Distributions may be taken at any time. Distributions before the age of 59½ may be subject to a 10% penalty if taken before that age.||Distributions may be taken at any time. They are tax- and penalty-free for contributions. Distributions on earnings may be subject to taxes and penalties, unless qualified. Generally to be qualified, the funds must be held in the account for at least 5 years and meet certain criteria if under the age of 59½. Qualified early distribution criteria for earnings include: educational expenses, medical expenses, and the purchase of a first home.|
|Required Minimum Distribution||Generally, you must begin taking distributions by April 1 of the year following the year in which you reach age 72 (or 70 ½ if you turned 70 ½ before January 2020).||Roth account holders aren’t subject to RMD rules. However, beneficiaries receiving Roth IRA funds are subject to certain RMD rules.|
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, please 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.
Open the account you’ll use to fund your IRA. You can choose between Ally Invest Self-Directed Trading or an Ally Invest Managed Portfolio. Within the application select Rollover IRA when prompted, or choose Roth IRA if your 401(k) or 403(b) is currently a Roth account. Then contact your plan provider, and request a rollover. The most common method of transfer is a direct rollover, but you can also transfer through an indirect rollover. You’ll want to make sure your funds get deposited within 60 days to avoid additional taxes and penalty fees.
For direct rollovers, have your Ally IRA account number on hand, and ask your provider to complete a paperless wire transfer or mail us a paper check made payable to Ally Invest.
Checks can be mailed to:
P.O. Box 30248
Charlotte, NC 28230
For indirect rollovers, keep in mind that 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. Once you receive your workplace retirement funds, deposit them within 60 days into your Ally IRA by:
- Sending a check
First, fill out the IRA deposit slip. Make your check payable to Ally Invest, write rollover in the memo line, and mail it along with the slip to:
P.O. Box 30248
Charlotte, NC 28230
-Requesting a bank wire transfer
Provide the following information to the bank sending the wire transfer to us:
Routing number: 071000288
Account number: Your Ally Invest account number
Name on bank account: Apex Clearing Corp
For further credit to: Name as it appears on your Ally Invest account
For further credit account: Your 8-digit Ally Invest account number
Ask your bank to denote that your wire transfer is for a rollover. Also, make sure to fill out the IRA deposit slip. Within your account, go to Bank Account Messages, choose IRA Distribution Request as the subject, and send the message with the completed deposit slip attached.
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 either of our Ally Invest accounts:
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