Al,

1. The IRS has not released any reporting instructions or forms yet for 2010 conversions. This is only a guess, but I think the IRS is going to want to know the gross conversion done in 2010 even though the default is for no income to be reported that year. If the taxpayer then opts out of the deferral, the IRS will know the amount to be reported for 2010. Consistent with this 1099R reporting, the 8606 would be required for 2010, but possibly contain the requirement to show the deferred amounts of the opt in amount. There are probably other ways to do this and it is likely that the IRS will pick some other method to coordinate custodian with taxpayer reporting.

2. If taxpayer dies in 2010 or 2011, the income must be fully reported on the final tax return of the decedent. However, there is an option for a sole surviving spouse beneficiary to continue the deferral on their single returns for 2011 or 2012 as decedent intended. The survivor must make this irrevocable decision by 10/15 of the year following decedent’s death. In your example that means 10/15/2012. I am not sure whether this also means that the survivor can reverse the decedent’s opt out or just continue the deferral if decedent did NOT opt out. I am getting this from a book on Roth IRAs by a well known tax attorney.

I would be happier to have a link to the entire bunch of technical amendments that affected Sec 512 of TIPRA (2005) that initially allowed for the 2010 conversions 5 years thereafter. The original Sec 512 does not contain many of these supplemental provisions, and I am not sure just how many amendments there might be that have changed 512 in the last 5 years. The book went to publication in Oct, 2007.

• Flag as spam
• Log in to Reply