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Have You Ever Been Able to Have A Bank/CU Direct-Transfer IRA/HSA/Roth $ Via A Wire?

racecar
  |     |   628 posts since 2014

Moving IRA/HSA/Roth $ is different than moving normal funds. There's a lot of paperwork and IRS compliance. The few times I've had my current FI where I had IRA/HSA/Roth funds direct-transfer it to another FI, the only option has always been for the current FI to send a paper check to the new FI where the IRA/HSA/Roth funds are being transferred to.

(I'm not talking about indirect rollovers, where the current FI can wire you the money, and you then have 60 days to redeposit it elsewhere yourself -- I'm asking only about when the transfer is done directly from one FI to another, bypassing you).

For instance: moving funds in your IRA account at NavyFed to your IRA account at Vanguard. Or moving funds in your Roth account at Chase to your Roth account at Alliant.

For this kind of direct institution-to-institution IRA transfer, does every place only do it via a paper check? Or have some of your FIs been able to do such transfers by wire?

It can take 1-2 weeks (once the old FI finally sends the paper check) for the new FI to receive, open and process it. But whenever I've asked, I've always been told it's done only via paper check.

Anyone had any luck having their FIs do such transfers via a wire instead?

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MY2CENTSWORTH
  |     |   440 posts since 2016
What you describe is exactly what I have experienced 99% of the time. However, when I had an issue internally with an IRA held at MACU and the holdup was due to an error on their end the CSR did overnight the funds for me as a courtesy...so it must be something that is an option, but for some reason in is not their typical operating procedure. I really didn't know if it was a wire or simply overnighted a check, but it sure would be nice if that could be changed to eliminate the paperwork and snailmail. After all, this is 2025!!!
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racecar
  |     |   628 posts since 2014
Overnight it... that's a great idea, it didn't even occur to me. I think most places would do that for a fee. It would at least save 3-6 days (if there's a weekend) in mail time, though it wouldn't help the slowish process of the receiving FI opening mail, sending it to the right people, and processing it when they get around to it, where a wire would be same-day to the right account. But I've never heard of a wire being an option for FI to FI direct transfers of IRA funds (bypassing you).
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alan1
  |     |   880 posts since 2015
posted in error -- my apologies
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NiceDepositor
  |     |   2 posts since 2025
There are three standard options for making the transfers that may be available:

*Send check by snail mail
*Send check by overnight mail
*Send funds by wire transfer

Send check by snail mail
This is the usual default option. You know the drill.

Send check by overnight mail
This option may or may not be available and there may or may not be a fee charged for it.

Send check by wire transfer
This is the least common option. It is sometimes available but caveat emptor.
If they do not do the wire properly and it ends up being coded as a distribution you could potentially have serious tax consequences or at the least a lot of headaches with the tax authorities.

In my experience many FIs do not know how to do IRA wire transfers properly so it is very risky to ask them to do it and you have no control over what happens.

Additional notes:
*Many FIs will charge large fees to do a direct transfer in addition to any fees for transferring the funds.

*The method used to make the transfer from above may have little effect on how long the process takes. Fis on both ends slow walk the process and often don’t have enough trained staff to handle it.

I just completed a wire transfer last week that went perfectly. But it is a nail biting process even after having a lot of experience and spending way too much time overseeing every move they made on both ends. I’ve had cases where a wire transfer was made and slow processing by both counterparties still put the funds out of commission and uninvested for weeks because of FI processing delays.  Somebody made money on it but it wasn't me. That can cost you a fortune if the amount transferred is high and there is little you can do about it.

Add to the mess that by the time it is processed the rates you bargained for may no longer be available to you and you will be stuck with either the current rate or yet another unbearable transfer and the associated costs.  And in a falling rate environment that may end up being rinse and repeat.

It’s the most aggravating, most inefficient, most potentially expensive transaction in retail banking. It’s stuck in the stagecoach era. The method of transferring the funds is often only a small part of the delay.
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Ally6770
  |     |   4,307 posts since 2010
I have had wires done twice now on Roth IRA's. I was told that the Post Office no long guarantees over night. Maybe take up to 3 days. When they still did overnight Navy did it for $5. But this a few years ago.
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CDMD
  |     |   142 posts since 2022
I would highlight that any of these three methods could cause an error in tax reporting by either the sending or receiving institution. Putting the funds expediency issue aside momentarily. Be extra diligent on how its coded. Have had errors happen on both sides. Sending not reporting it as a direct trustee to trustee transfer. And receiving reporting it as a new contribution when it’s not. Be extra careful don’t assume they know what they are doing.
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