[quote=”[email protected]“]Two quickies..

First, to convert an IRA to a Roth the IRA needs to be in existance for 2 years? If I start an IRA today then is it 2 years from today or if it’s a 2008 contribution does the clock start 1/1/08? Important if you want to convert in 2010 when the restrictions come off. Also, if you contribute to an existing IRA is it 2 years from this particular contribution or when the IRA was established?

Second, in 2010 when the restrictions for converting come off does the income limits for contributing to a Roth also come off?

Thank you.[/quote]

That’s four blaxter:D

1. No. That rule applies to SIMPLE IRAs only. See http://www.retirementdictionary.com/2-year-rule-SIMPLE-IRA.htm
2. Because of the response to 1, 2 is N/A
3. Ditto
4. No

• Flag as spam
• Log in to Reply

Both the current modified AGI and marital filing status limitations for Roth conversions end on 12/31/2009.

You are correct that anyone with earned income qualifies to make a non deductible TIRA contribution. Therefore, any portion of a TIRA balance can be converted to a Roth IRA every year starting with 2010. The taxable portion of these conversions are calculated on Form 8606 in reporting these conversions. It is also used to report the non deductible TIRA contributions. If there is no prior TIRA balance, these non deductible contributions and whatever earnings they develop could be converted every year taxfree accept for the earnings portion. This option would replace regular Roth contributions if modified AGI remains too high to make these contributions directly.

• Flag as spam
• Log in to Reply