A new tax rule could create problems for investors who roll money from matured IRA certificates of deposit into new IRA CDs. Thinkstock By Susan B. Garland, Contributing Editor From Kiplinger's Retirement Report, August 2014 It's not unusual for a retiree to own multiple IRA certificates of deposit at once. When one CD matures, the bank will likely close the IRA and hand you a distribution check. You then roll the money into a new IRA CD, often at another bank that's offering a higher interest rate. You repeat the process when the next CD expires. A new court ruling, however, can foul up the process.See Also: SLIDE SHOW: 10 Things You Must Know About Traditional IRAs Until recently, if you owned more than one IRA, you could roll over each one once a year. As long as you completed the switch within 60 days of the payout, there was no tax. Now, thanks to a U.S. Tax Court opinion, such IRA CD rollovers could be "very risky" for older investors, says Natalie Choate, an estate-planning lawyer with Nutter, McClennen and Fish, in Boston. The court ruled that the once-a-year rollover limit applies to the investor, not to the individual IRA. No matter how many IRAs you own, only one rollover is permitted in any 12-month period. The IRS announced it will not enforce the ruling until 2015. You can avoid trouble by using direct IRA-to-IRA transfers rather than 60-day rollovers. With a transfer, the first bank with the maturing CD sends the money directly to the second bank, and you are never in possession of the money. "You can make as many direct transfers in a year as you want without any worries," says Jeffrey Levine, IRA technical consultant with Ed Slott and Co., in Rockville Centre, N.Y. Advertisement To use the direct-transfer method, first find out when your CD matures. Then find a bank with a better rate. Before the old CD comes due, open an IRA at the second bank and ask about any paperwork you must fill out to transfer the money. Make sure the second bank does not send the paperwork until the CD matures, or you'll likely pay an early-withdrawal penalty. If you want to stick with the same bank, ask about its transfer procedure. Although the IRS says it will hold off enforcing the new rule, Levine encourages IRA owners to follow it immediately. It's unclear when the 365-day clock begins. For instance, if you do a rollover in September this year and then another in March, it's possible the IRS could look at the March rollover as the second one in the 12-month period. Haven't yet filed for Social Security? Create a personalized strategy to maximize your lifetime income from Social Security. Order Kiplinger’s Social Security Solutions today.