Skip to main content

Individual Retirement Accounts (IRAs)

Find the IRA to meet your retirement goals

No matter what your retirement strategy, Merrill offers many types of accounts to help you make the most of your future. With a full range of IRAs to choose from, you can enjoy tax-deferred growth potential.
Tab One

Traditional IRA

You may receive tax benefits, and enjoy tax-deferred growth, and generally, you pay taxes when you withdraw money in retirement.

Roth IRA

Potential to earn tax-free income and greater withdrawal flexibility in retirement (No RMDs required for original account owner).

Rollover

Thinking of rolling over a 401(k), 403(b), IRA or SEP IRA? Rolling over funds at Merrill offers a convenient way to maintain your retirement plan's tax deferred status while consolidating your retirement assets into one easy-to-manage account. Consider all of your choices and learn if a rollover may be right for you.Footnote 1
Features & benefits:
  • Contributions and earnings may be withdrawn without a 10% additional tax at or after age 59½
  • Contributions may be tax-deductible
  • If you have taxable accounts to draw from in retirement, you can draw them down and allow your Traditional IRA assets to continue to potentially grow tax-deferred until age 72Asterisk *, after which time required minimum distributions must be taken.
  • Contributions (not earnings) can be withdrawn tax-free at any time
  • Contributions are not tax-deductible
  • Qualified withdrawals are federal tax-free and may be state tax-free after age 59½ and account has been open five years or more
  • No income restrictions required on converting a Traditional IRA to a Roth IRA
  • Access to a full range of investment choices while consolidating multiple 401(k) and 403(b) retirement plans.
  • If you have taxable accounts to draw from in retirement, you can draw them down and allow your Rollover IRA assets to continue to potentially grow tax-deferred until age 72Asterisk *, after which time required minimum distributions must be taken.
  • If you choose to rollover your 401(k) assets into a Merrill IRA, your money will keep its tax-deferred status until you withdraw it
Who is eligible:
  • Anyone who has earned income equal to or greater than their IRA contribution is eligibleAsterisk *
  • Contributions may be tax deductible for single tax filers earning less than $76,000 MAGI ($75,000 for 2020)Footnote 3
  • Contributions may be tax deductible for joint tax filers earning less than $125,000 MAGI ($124,000 for 2020)Footnote 3
  • Single tax filers earning less than $140,000 MAGI ($139,000 for 2020)Footnote 3
  • Joint tax filers earning less than $208,000 MAGI ($206,000 for 2020)Footnote 3
  • Anyone with retirement assets from previous employers or IRAs. Contact a Merrill rollover specialist for details
Are you self-employed or a sole proprietor?

Frequently Asked Questions

What is an IRA?

An Individual Retirement Account (IRA) provides a tax-deferred way for you to save for retirement. There are many different types of IRAs but Roth and Traditional IRAs are the most common.

How does an IRA work?

IRAs rely on long-term, tax-deferred compounding to provide your retirement savings the opportunity to grow. When you earn interest, receive a dividend or sell an investment (such as a mutual fund) for a gain, you don't pay taxes that year on the earnings. Instead, all taxes are deferred until you withdraw those earnings in retirement.

Why is an IRA important now?

In retirement you may need as much as 100% of your current after-tax income (take-home pay) minus any amount you are saving for retirement each year. This makes it all the more important to start saving sooner rather than later, and an IRA can help you get started.

What are the ways I can invest in an IRA?

You can choose from investment products such as mutual funds, stocks, bonds and ETFs, as well as bank products like CDs and money market savings.

What are the contribution deadlines?

You can make contributions to an IRA for a given tax year until the tax return filing deadline of the following year. Be sure you understand the applicable contribution limits and what happens if you exceed those limits.

How do I convert to a Roth IRA?

A Roth IRA Conversion could help grow your retirement assets federal income tax-free. To help you convert to a Merrill Edge Roth IRA, call us at 888.637.3343 for one-on-one assistance and we'll guide you every step of the way. We're here 24 hours a day, 7 days a week.

What are my options for converting a 401(k) to an IRA?

You have choices about what to do with your employer-sponsored retirement plan accounts. Depending on your financial circumstances, needs and goals, you may choose to roll over to an IRA or convert to a Roth IRA, roll over an employer-sponsored plan account from a prior employer to an employer sponsored plan at your new employer, take a distribution, or leave the account where it is. Each choice may offer different investment options and services, fees and expenses, withdrawal options, required minimum distributions, tax treatment, and different types of protection from creditors and legal judgments. These are complex choices and should be considered with care. Visit our Rollover IRA page or call a Merrill rollover specialist at 888.637.3343 for more information about your choices.

Tab Two

SEP IRA

Self-employed, sole proprietorships, partnerships, non-profits and corporate employers who want tax-deferred growth potential plus flexibility on making annual contributions

SIMPLE IRA

Small businesses with less than 100 employees who want to enjoy tax-deferred potential growth and deductions on contributions to individual accounts

Features & benefits:
  • Employer makes all contributions
  • Access to Merrill Lynch E-contribs for Small Business Retirement Accounts for convenient, online contributions
  • Investments may be subject to commissions, loads, and operating expenses. Fees may also apply for certain transactions including account closure.
  • No program or administrative fees when applying online
  • Custodial fees may apply to a SEP opened with guidance from a Merrill Edge Financial Solutions Advisor for Small Business. See pricing details.
  • Early withdrawal penalty applies if taken prior to age 59½
  • Required minimum distributions starting at age 72*
  • No IRS Form 5500 filing
  • Employees may make salary deferrals
  • Mandatory employer match contributions of employees' pre-tax salary deferrals; employer either matches or makes a contribution to all eligible employees
  • Greater control over investment choices compared to other retirement plans
  • Access to Merrill Lynch E-contribs for Small Business Retirement Accounts for convenient, online contributions
  • Investments may be subject to commissions, loads, and operating expenses. Fees may also apply for certain transactions including account closure.
  • Withdrawals are generally subject to 25% additional tax if withdrawal occurs in the first two years of participation.
  • No IRS Form 5500 filing
Who is eligible:
  • Anyone at least 21 years of age who earns a minimum of $600 in annual income and has worked for the company in at least three of the past five years
  • Earned income of at least $5,000 for any two prior years and expected to earn at least $5,000 in the current year
For other small business retirement solutions, we offer a variety of plans to suit your needs.
* Investments may be subject to commissions, loads, and operating expenses. Fees may also apply for certain transactions, including account closure.

Frequently Asked Questions

SEP IRA
  • Do I have to contribute annually?

    No. A SEP IRA gives you the flexibility to decide each year whether to contribute and at what rate. That could mean contributing more during profitable years and less or nothing at all during less profitable years.
  • Is it difficult to administer a SEP IRA?

    SEP IRAs have little to no paperwork and administration and don't require filing with the IRS.
  • Is there investment research I can review?

    Yes. As a Merrill client, you get access to award-winning BofA Global ResearchFootnote 2 as well as research from other industry leaders to gain investing knowledge and market insights that can help inform your investment strategy.
SIMPLE IRA
  • Is there a mandatory employer match?

    Yes. With a SIMPLE IRA, you must contribute either 2% of compensation for each eligible employee, regardless of participation, or a dollar-for-dollar match of employee salary deferral contributions, capped at 3% of compensation (which may be reduced to as low as 1% in any two years during a 5-year period).
  • What if my business grows beyond 100 employees?

    You may need to consider establishing a small business 401(k) plan when your business grows to more than 100 employees. A Financial Solutions Advisor can help you consider your options. Please note: If you decide to establish a 401(k) plan, you would stop contributions to the SIMPLE IRA plan and then start the 401(k). Participants that have been in the SIMPLE IRA plan for over two years may roll their SIMPLE IRA assets over to the new 401(k) if it allows for rollovers. Before making any decisions, you should speak with your tax and legal advisor about your situation and the requirements for terminating a plan and establishing a new one.
  • Is it difficult to administer a SIMPLE IRA?

    We have many ways to make managing your retirement plan easier. Our Merrill Lynch E-Contribs for Small Business Retirement Accounts provides small business owners with a convenient web-based solution for making contributions to retirement plan accounts, while the Automated Investment Program provides a systematic way to invest in mutual funds on a schedule based on your needs.

    Employee-elected salary deferrals will be deducted from employee pay through your payroll company. You will be required to send an annual notice to your employees notifying them of their ability to make or modify existing salary-reduction contributions under the plan. You do not file IRS Form 5500 as you would with a 401(k) plan.
Looking for a guaranteed return for the term of your IRA CD? IRAs from Bank of America are FDIC insured and offer interest-bearing CD or money market savings account choices.
Ready to get started?
888.637.3343
Call 24 hours a day, 7 days a week
I'd like to...
Merrill Edge Self-Directed was named one of the "Best IRA Accounts" by NerdWallet 2021 review.Footnote 4
Footnote 
The required beginning date for RMDs is age 72. You may defer your first RMD until April 1st in the year after you turn age 72, but then you'd be required to take two distributions in that year. Failure to take all or part of an RMD results in a 50% additional tax applicable to the amount of the RMD not withdrawn. Consult your tax advisor for more information on your personal circumstances.
Footnote 
You have choices about what to do with your employer-sponsored retirement plan accounts. Depending on your financial circumstances, needs and goals, you may choose to roll over to an IRA or convert to a Roth IRA, roll over an employer-sponsored plan from your old job to your new employer, take a distribution, or leave the account where it is. Each choice may offer different investment options and services, fees and expenses, withdrawal options, required minimum distributions, tax treatment, and different types of protection from creditors and legal judgments. These are complex choices and should be considered with care. For more information on rolling over your IRA, 401(k), 403(b) or SEP IRA, visit our rollover page or call a Merrill rollover specialist at 888.637.3343.
Footnote 
Institutional Investor magazine announced BofA Global Research as one of the Top Global Research Firms in 2020 based on surveys held throughout the year. The magazine creates rankings of the top research analysts in a wide variety of specializations, drawn from the choices of portfolio managers and other investment professionals at more than 1,000 firms. BofA Global Research is research produced by BofA Securities, Inc ("BofAS") and/or one or more of its affiliates. BofAS is a registered broker-dealer, Member SIPC popup, and wholly owned subsidiary of Bank of America Corporation. For more information about this award, go to Institutional Investor popup. Rankings and recognition from Institutional Investor are no guarantee of future investment success and do not ensure that a current or prospective client will experience a higher level of performance results and such rankings should not be construed as an endorsement.
Footnote 
Contribution and compensation limits are subject to a cost-of-living adjustment annually pursuant to the Internal Revenue Code. Contribution and compensation limits for subsequent years may vary.
Footnote 
Merrill Edge Self-Directed was named by NerdWallet as one of the "Best IRA Accounts", January 2021. NerdWallet evaluates brokers based on investment selection, customer support, account fees, account minimum, trading costs and more. Learn more at Nerdwallet popup. Rankings and recognition from NerdWallet are no guarantee of future investment success and do not ensure that a current or prospective client will experience a higher level of performance results and such rankings should not be construed as an endorsement.
3444797