My wife changed brokerage firms in 2017 and the old company sold off fractional shares from my wife's IRA as part of the process - are there penalties because of this?

[KatherineC · Accepted solution]

If the sales were within the IRA account, then no, there are no penalties.  The fractional shares were likely sold to pay brokerage fees.

There would only be penalties if your wife withdrew the amounts from her IRA. in which case she would receive a Form 1099-R.