I'm wondering if anyone has bought an Ally Bank IRA CD by transferring funds from their regular IRA account at Vanguard and can fill me in on how this works. What I'm looking for is a seamless way to transfer IRA funds between the Vanguard IRA and the Ally IRA CD -- both ways -- without having to take an IRA distribution as part of the process. I'm not sure that it can be done because I don't understand what Ally does (or doesn't do) and the online chat with them was worthless. I have these questions:
1) can you directly transfer funds from Vanguard IRA to Ally to purchase an Ally IRA CD? How does the process work and have you had any problems?
2) when the Ally IRA CD matures, can you directly transfer the proceeds back to Vanguard IRA -- in order to avoid the proceeds being paid out by Ally as an IRA distribution?
3) if you "break" the Ally IRA CD before it matures, can you directly transfer proceeds back to Vanguard IRA to avoid taking an IRA distribution from Ally? Some banks seem to regard breaking an IRA CD as synonymous with closing the IRA and taking a distribution of the account value, so you can't do a direct trustee-to-trustee transfer under this scenario and you are subject to mandatory 20% withholding tax.
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