1 Reply Latest reply on Apr 16, 2016 12:02 PM by JerryD

    IRA Conversion


      I am considering converting an IRA to an Roth IRA.  I see lots of information about how to do it and a bit about if to do it, but it is all from published articles.  Does anyone have any experience in doing this that they could share?  Many thanks!

        • Re: IRA Conversion

          We have done many IRA -> Roth conversions as a strategy to make IRA money tax free forever.  A secondary benefit is that making IRA money Roth money insures that one's Required Mandatory Distributions (RMD's) are also reduced and Roth money also has no required distribution.


          We try to make sure that the tax cost of any IRA -> Roth conversion is done at a low marginal tax rate. This is possible when income is low such as when retired but not yet taking RMD's. Another surprising "opportunity" is when one has excess deductions that can cover the taxable income created by the Roth conversion. A real surprise is when you have lots of deductions and lost your job. Use up your "excess" deductions with "free" Roth conversions.


          Another factor is to maximize the Roth money by not taking the taxes out of the conversion, if possible. Having a taxable account to pay the taxes will maximize the money going into the Roth.  GOOD LUCK!!!!!   :-))))