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Frequently Asked Questions (FAQs)
| Account Opening Questions |
What is the minimum investment required to open a Traditional or Roth IRA with Delaware Investments?
The minimum investment needed to open a Traditional or Roth IRA with Delaware Investments is $250 with subsequent investments of at least $25.
How do I establish a Traditional or Roth IRA with Delaware Investments?
To establish a Delaware Investments Traditional IRA or Roth IRA, first fill out an IRA / Roth Application (Form #1 of the IRA Forms Booklet). If you are opening an IRA for both you and your spouse, two applications must be used. Next, make your contribution check payable to Delaware Management Trust Company and mail to:
Delaware Investments
P.O. 219691
Kansas City, MO 64121-9691
How do I transfer my Traditional IRA with another company to a Traditional IRA with Delaware Investments?
If you already have an IRA established at Delaware Investments, complete a Transfer of Assets Form (Form #2 of the IRA Forms Booklet) and mail to:
Delaware Investments
P.O. 219691
Kansas City, MO 64121-9691
If you don't have an IRA account with Delaware Investments, fill out an Individual Retirement Account Application (Form #1 of the IRA Forms Booklet) and a Transfer of Assets Form (Form #2 of the IRA Forms Booklet) and mail to above address.
Are there any fees associated with a Delaware Investments IRA?
Yes. A yearly maintenance fee of $15 per social security number is charged every year in May. This fee can be prepaid at any time prior to the May withdrawal date.
| Account Contribution Questions |
How do I get contribution information regarding my Traditional or Roth IRA for tax purposes?
Contributions: Each May, IRS form 5948 is generated for account holders who have contributed to an IRA. The form contains all regular IRA contributions designated for the previous tax year, as well as rollover contributions.
Can a minor contribute a Traditional or Roth IRA?
Anyone with earned income (under age 70½ for a Traditional IRA) can contribute to an IRA, even a child. Income from doing chores around the house is considered earned income. It can be opened as a Traditional or Roth IRA with a maximum contribution of $4000 or 100% of earned income, whichever is less. To establish an IRA for a minor at Delaware Investments, the account must be opened and held by an adult, as guardian, in the name of the minor. The adult must sign the account application. While the adult is the individual authorized to perform transactions on the account, the minor is considered the registered owner for tax purposes.
When is the last day I can contribute to my Traditional or Roth IRA?
The last day to contribute to a Traditional or Roth IRA is April 15th of the following year. For example, the last day to make a contribution for year 2004 is April 15, 2005.
What is the maximum that I can contribute to a Traditional IRA or Roth IRA?
The maximum annual contribution must not exceed $4,000 or 100% of your compensation, whichever is less. This is the combined limit of both Traditional and Roth IRAs. If you are 50 years or older you can make an additional contribution of $500.
Can I contribute to both a Traditional and Roth IRA?
You are able to contribute to both a Traditional and Roth IRA as long as you meet the eligibility requirements, but your combined contributions should not exceed $4000 combined for all the accounts. If you are 50 years or older you can make an additional catch up contribution of $500.
| Account Distributions Questions |
How do I get distribution information regarding my Traditional or Roth IRA for tax purposes?
Distributions: Each January, IRS Form 1099R is mailed to IRA holders who have recieved a taxable distribution from their IRAs during the previous year.
Can I make a withdrawal from my Traditional or Roth IRA for the purchase of a home?
You are able to make a distribution from a Traditional IRA or Roth IRA for a first time home purchase (up to $10,000 for a lifetime maximum).
When can I start making withdrawals from my Traditional IRA?
You are able to begin withdrawals from a Traditional IRA at age 59½ without incurring a 10% penalty from the IRS. At age 70½, you are required to begin your Required Minimum Distributions, which is taking out a minimum amount each year based on your life expectancy.
Is there a penalty for making a withdrawal from a Traditional IRA before age 59½?
Yes, the penalty for making a withdrawal from a Traditional IRA is 10% from the IRS, in addition to ordinary income taxes.
When am I required to take distributions from my IRA?
Traditional IRA: At age 70½ you are required to take Required Minimum Distributions (RMD).
Roth IRA: There are no required distributions.
Will I be reminded when I need to start taking Required Minimum Distributions?
Delaware Investments will send a letter reminding you of Required Minimum Distributions at the appropriate time. These IRA holders will also receive a worksheet to help you make the correct calculations.
Can I receive retirement distributions automatically?
Yes. Delaware Investments offers a Systematic Withdrawal Plan for convenient automatic distributions when you are ready to receive income for your retirement.
What is an IRA rollover?
An IRA rollover is when you move your assets from a qualified plan into an IRA. You are only allowed to move your assets as a result of a "triggering event" or if your plan allows in-service withdrawals. Triggering events include termination of employment, disability, death or plan termination. An IRA rollover is not a taxable event. Unlike annual IRA contributions, it is not subject to the yearly $4000 limitation. You cannot roll qualified plan assets directly into a Roth IRA. You must first move qualified plan assets into a Traditional IRA then convert to a Roth IRA.
How do I rollover money to Delaware Investments?
If you already have an IRA established at Delaware Investments, complete a Direct Rollover Form (Form #3 of the IRA Forms Booklet) and mail to:
Delaware Investments
P.O. 219691
Kansas City, MO 64121-9691
If you don't have an account with Delaware Investments, fill out an Individual Retirement Account Registration Form (Form #1 of the IRA Forms Booklet) and a Direct Rollover Form (Form #3 of the IRA Forms Booklet).
How often can I rollover a distribution?
You may receive a distribution from an IRA and roll the distribution to another IRA only once a year. The one-year period begins on the date that you receive the distribution and not the date it is rolled into another IRA. Direct custodian or trustee-to-trustee transfers are not subject to this rule.
When can I access my IRA assets?
Generally, you may access your IRA assets anytime. However, if you are under age 59½ and you withdraw assets from your IRA, you may pay a 10% additional penalty tax on any taxable amount of the withdrawal. With the Traditional IRA you must begin withdrawing assets by age 70½ (Required Minimum Distributions or RMD), whether or not you need the money. You can make penalty-free distributions from a Traditional and Roth IRA before age 59½ for reasons such as, death, disability, qualified higher education expenses, and first time home purchase up to $10,000 life time maximum, medical expenses exceeding 7.5% of AGI (Adjusted Gross Income).
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