How to Transfer a Traditional IRA from Charles Schwab to Interactive Brokers

As your financial goals evolve, you may find that a different investment platform better supports your retirement strategy. Whether you’re seeking access to more global markets, lower transaction costs, or enhanced trading tools, transferring your Traditional IRA from Charles Schwab to Interactive Brokers can help align your retirement assets with your current investment priorities. With proper planning and attention to detail, this type of transfer can be completed smoothly while maintaining the tax-deferred status of your account.

At Carry, we want to make financial decisions feel more manageable, even if you’re handling them outside our platform. This guide breaks down the steps to transfer your Traditional IRA from Charles Schwab to Interactive Brokers smoothly and penalty-free. Please note that while we try to provide the most up-to-date information, these processes are subject to change without notice, so be sure to check with your provider before moving forward.

Step 1: Prepare for the IRA Transfer

Moving a Traditional IRA from Charles Schwab to Interactive Brokers requires careful coordination to ensure a smooth and tax-free process. Before you begin, you’ll want to ensure everything is set up correctly to avoid potential delays or complications.

Information and documents to have ready:

✅ Charles Schwab Traditional IRA account number

✅ Social Security Number

✅ Interactive Brokers IRA account details

✅ Most recent IRA statement 

✅ Government-issued photo ID

📝 Pro Tip: Double-check all your personal information matches exactly across both accounts to avoid transfer delays.

Step 2: Initiating Your IRA Transfer

Log in to your Interactive Brokers account and begin the transfer process by completing their online transfer authorization form. This will include entering details about your Charles Schwab IRA and specifying the transfer type and authorizing the transfer of funds.

✏️ Hypothetical Example: Sarah logged into her Interactive Brokers account, selected “Transfer & Pay,” then chose “Transfer Funds” > “IRA Transfer” and followed the prompts.

Key actions to take:

Step 3: Gather Required Documentation

Having your documentation ready ensures a more efficient process. Be prepared to upload or submit:

✅ Latest IRA account statement from Charles Schwab

✅ Government-issued photo ID

✅ Completed transfer authorization form

✅ IRA account details for both Charles Schwab and Interactive Brokers

📝 Important Note: All documents must reflect the same personal information to avoid processing issues.

Step 4: Choose Your Transfer Method

You have two options for transferring your Traditional IRA:

1. Direct Transfer (Recommended)

✅ Funds move directly between financial institutions

✅ No tax consequences

✅ Typically faster and more straightforward

2. Rollover Method

❌ Funds are sent to you, then you must deposit them into the new account within 60 days

❌ Subject to 20% withholding and possible tax penalties if mishandled

Step 5: Review Potential Transfer Fees

Charles Schwab may charge a $50 fee if you fully close the IRA. Partial transfers usually do not incur fees. Interactive Brokers typically does not charge any fees for processing incoming transfers into their IRAs.

It’s always advisable to review all associated fees and consult with both institutions to ensure a smooth transfer process.

✏️ Hypothetical Example: John transferred 80% of his IRA balance and was not charged any fees by Charles Schwab.

Step 6: Understand the Tax Implications

Traditional IRA transfers between like accounts are typically tax-neutral when done correctly. The key is to ensure the transfer is completed as a direct transfer to avoid any potential tax consequences.

📝 Reminder: When in doubt, consult a tax advisor to confirm how the transfer might affect your situation.

Step 7: Know the Timeline

Most IRA transfers between institutions typically take 5–10 business days, though delays can happen if paperwork is incomplete or account details don’t match.

Step 8: Verify Completion

Once the transfer is processed:

✅ Log into both Schwab and Interactive Brokers to confirm the full amount was transferred
✅ Check for any unexpected charges
✅ Review your new investment allocations at Interactive Brokers

📌 Additional Resources:

Final Thoughts on Transferring Your Traditional IRA

Moving a Traditional IRA from Charles Schwab to Interactive Brokers is a straightforward process when approached with careful planning. The most important steps include confirming your account details, selecting a direct transfer to avoid tax implications, and ensuring all required documentation is complete and accurate.

Most transfers between Traditional IRAs are free of charge, but it’s always a good idea to confirm any potential fees or requirements with both providers before proceeding.

Next steps:

✅ Gather your most recent Charles Schwab IRA statement
✅ Verify your Interactive Brokers IRA account is open and ready
✅ Initiate the transfer using ACATS or a direct trustee-to-trustee method

📌 Want to dive deeper? Here are some other helpful (and free) resources:

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Disclaimer:

The Carry Learning Center is operated by The Vibes Company Inc. (“Vibes”) and contains generalized educational content about personal finance topics. While Vibes provides educational content and technology services, all investment advisory services discussed on this website are provided exclusively through its wholly-owned subsidiary, Carry Advisors LLC (“Carry Advisors”), an SEC registered investment adviser. The information contained on the Carry Learning Center should not be construed as personalized investment advice and should not be considered as a solicitation to buy or sell any security or engage in a particular investment, accounting, tax or legal strategy. Vibes is not providing tax, legal, accounting, or investment advice. You should consult with qualified tax, legal, accounting, and investment professionals regarding your specific situation.

The accounts, strategies and/or investments discussed in this material may not be suitable for all investors. All investments involve the risk of loss, and past performance does not guarantee future results. Investment growth or profit is never a guarantee. All statements and opinions included on the Carry Learning Center are intended to be current as of the date of publication but are subject to change without notice.

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