Safe Harbor IRA Frequently Asked Questions (FAQs)
General
- What is a Safe Harbor IRA?
- I did not request that a Safe Harbor IRA be opened for me, why did this happen?
- Will I receive something from Principal Bank notifying me about my Safe Harbor IRA?
- Are there any bank fees?
Forms
- How can I obtain forms needed to withdraw the Safe Harbor IRA?
- Why did I receive both a Safe Harbor IRA signature card and an Affidavit of Identity?
- What is the Safe Harbor IRA signature card?
- I was told I need to complete an Affidavit of Identity. Why is that?
- What is a W-9 and why do I need to complete one?
- Will I have the same beneficiaries as I did with my employer sponsored plan?
Options
- How do I withdraw some or all of my funds from the Safe Harbor IRA?
- What other investment options does Principal Bank offer for the funds in my Safe Harbor IRA?
- I want to rollover my Safe Harbor IRA to my new employer-sponsored plan. How do I accomplish this?
- I want to transfer my Safe Harbor IRA into a retirement account at another financial institution. How do I accomplish this?
- Can I make additional deposits to this account?
General
What is a Safe Harbor IRA?
The Principal Bank Safe Harbor Individual Retirement Account (IRA) is a qualified retirement account that is established for individuals who leave an employer without making an election of benefits for funds in an employer-sponsored retirement plan, such as a 401K. The current rate is found on www.principalbank.com/rates. Funds in your Safe Harbor IRA are protected by the Federal Deposit Insurance Corporation (FDIC) for up to $250,000 per depositor.
I did not request that a Safe Harbor IRA be opened for me, why did this happen?
The law now requires that retirement plan mandatory distributions of $1000 or more be automatically rolled into an IRA instead of being paid out in cash, unless the participant elects otherwise. So if you recently left an employer and did not make a decision about what to do with the funds left in your employer-sponsored retirement plan, they were moved into a Principal Bank Safe Harbor IRA on your behalf.
Will I receive something from Principal Bank notifying me about my Safe Harbor IRA?
Yes, a Welcome Kit was sent to the address we have on file for you once the account was opened. This Welcome Kit contains the following - a Safe Harbor IRA Signature card, a Welcome letter and a Safe Harbor IRA receipt. It may also include an Affidavit of Identity.
Are there any bank fees?
Yes. A $15 annual fee is charged. Additional fees may apply. See Schedule of Fees (PDF: 151KB) for more information.
Forms
How can I obtain forms needed to withdraw the Safe Harbor IRA?
You can access them and print them from the Safe Harbor IRA forms page, or you may contact a Personal Banker between 7 AM to 9 PM (Central time), seven days a week, excluding holidays at 1.877.884.7236. The forms can be mailed, faxed or emailed to you.
Why did I receive both a Safe Harbor IRA signature card and an Affidavit of Identity?
In many cases, the Affidavit of Identity will not be required. To minimize the delays in processing transactions on your account, we will usually send an Affidavit of Identity with all replacement signature cards. This will ensure we have the necessary information for your Safe Harbor IRA.
What is the Safe Harbor IRA signature card?
The Safe Harbor IRA signature card serves two purposes:
- It allows you to acknowledge and accept ownership of the account, including acceptance of the account Terms and Conditions (PDF: 199 KB).
- It allows you to certify your Taxpayer Identification Number (Social Security number), both of which are necessary before transfers, rollovers or distributions can occur.
I was told I need to complete an Affidavit of Identity. Why is that?
Safe Harbor IRAs are opened without the required customer information verifications that are standard for other types of accounts. To ensure that we are dealing with the true owner of the account, Principal Bank has an automated verification process for all new Safe Harbor IRAs. If the information provided by you does not match the information we have on file, you will not pass our Customer Identification Process. If that occurs, an Affidavit of Identity is required to guarantee we are dealing with the true account owner.
Note: The Affidavit of Identity will need to be notarized.
What is a W-9 and why do I need to complete one?
Form W-9 is the "Request for Taxpayer Identification Number and Certification" form. This form allows you to certify your taxpayer identification number. In most cases, the W-9 is necessary if you forget to write your Social Security Number in Section 4 of the signature card (see What do I need to fill out a SAFE Harbor IRA signature card).
Will I have the same beneficiaries as I did with my employer sponsored plan?
No. Since the Safe Harbor IRA is a completely separate qualified plan from your original employer-sponsored plan, you will need to designate new beneficiaries. This designation of beneficiaries can be done with an IRA Designation or Change of Beneficiary Form from Principal Bank's website. The form is located under Forms Library/IRA Forms (including Safe Harbor).
NOTE: If there is no beneficiary designation on file at the time of your death, or if none of the beneficiaries on file are living at the time of your death, your IRA assets will be paid to your estate.
Options
How do I withdraw some of all of my funds from the Safe Harbor IRA?
Please sign and return the Safe Harbor IRA signature card along with a completed IRA distribution form. An Affidavit of Identity may also be required.
What other investment options does Principal Bank offer for the funds in my Safe Harbor IRA?
There are other investment options for your Safe Harbor IRA, such as short-term or longer-term Certificates of Deposit. Please contact a Personal Banker at 1.877.884.7236 for more information.
I want to rollover my Safe Harbor IRA to my new employer-sponsored plan. How do I accomplish this?
You should first consult with your plan administrator to determine if the employer plan will accept additional assets and if the assets that you wish to rollover are eligible. In addition, the employer plan may require that you complete specific paperwork. They may also require that the cashier's check mailed to them be made out in a specific manner. You may also need the address of the plan administrator.
To request a direct rollover you may complete an IRA distribution form (PDF: 151 KB), and check the box for "Direct Rollover to an employer-sponsored Eligible Retirement Plan". Please also send your Safe Harbor signature card and the Affidavit of Identity (if applicable). A cashier's check will be made payable to the employer plan. You may direct us to send the check to either you for delivery to your plan sponsor, or directly to the plan sponsor.
I want to transfer my Safe Harbor IRA into a retirement account at another financial institution. How do I accomplish this?
Please contact the receiving institution (your new IRA custodian). They will provide you with the paperwork necessary to transfer the funds to them. Or you may use the IRA distribution form to initiate the transfer of funds to another institution. However, a Transfer form or a Letter of Acceptance from the receiving institution will be required. Please also send us your Safe Harbor IRA signature card and the Affidavit of Identity (if applicable).
Can I make additional deposits into this account?
Yes, you can. Please see IRA contribution form.
If you have other questions, please call us between 7 AM to 9 PM (Central time), seven days a week, at 1.877.884.7236.
