Non deductible IRA – Roth Conversion
If someone makes a non-deductible IRA contribution and then in 2010 converts the IRA to a ROTH would they pay income taxes on the growth of the money at the time of the conversion?
If someone makes a non-deductible IRA contribution and then in 2010 converts the IRA to a ROTH would they pay income taxes on the growth of the money at the time of the conversion?
Permalink Submitted by Alan Spross on Thu, 2008-02-21 05:04
Yes. But remember that all of the traditional IRA accounts must be considered in computing the pro rated taxable share.
Conversions done in 2010 include a special provision that the taxes are split between 2011 and 2012 unless you opt to pay them with the 2010 return.