Roth Conversion
What are the implications, if any, for the scenario below.
A client, currently age 42, converts $30,000 from a Trad IRA to a Roth IRA this year and makes no other contributions. 2 years later he takes distributions. What will he have to pay for these distributions?
If the client converts now and waits for 5 years before taking distributions, would any of the money be available with no taxes/penalties?
Permalink Submitted by James Garland on Tue, 2007-09-25 00:19
He will be subject to the 10% penalty if he withdraws any of the money before 5 years or 591/2.