MARCH 5, 2001
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 Money Matters
Are Your IRA Fees Billed Separately?

Gary Klott of TaxPlanet.com makes the following suggestion for anyone who invests in Individual Retirement Accounts: Have your IRA fees billed separately.

Normally, when the custodial fees for your IRA are due, the trustee will dip into the IRA funds to pay it. This may be simple and convenient for the IRA owner, but causes two problems:

  1. The fee cannot qualify for an income tax deduction as miscellaneous itemized expenses, and
  2. The amount of the fee is removed from the tax shelter of the IRA.
To avoid this, just notify the trustee, whether it be a bank, broker, or mutual fund company, that you would like to be billed separately for any fees. Such fees can qualify for a deduction under miscellaneous itemized expenses, which can be deducted to the extent they exceed two percent of adjusted gross income.
Source: www.taxplanet.com 2-2001