rmd requirement on Roth conversion after age 70 1/2
I am trying to find rules re whether client over age 70 1/2 has to satisfy RMD requirement on all IRA balances prior to doing a partial Roth conversion. Client has IRA worth $600,000, another worth $300k. He wants to do $120,000 conversion from the IRA worth $600k now. Does he have to take RMD on total balance before converion, RMD on $600k IRA, or just RMD on $120k?
Cleint is taking a systematic monthly withdrawal of total RMD amount at this time. I am being told he has to take full RMD prior to converting even a portion of his IRa to Roth IRa at this time.
Is this the case?
Thanks,
Paul Ciccarelli
Permalink Submitted by mk foss on Thu, 2010-05-27 22:15
All of his RMDs from both IRAs must be withdrawn before he can convert to Roth in 2010. The rule is that the first moneys that come from IRAs are RMDs and that RMDs cannot be rolled over or converted. Perhaps he can put the remainder of the RMDs into a separate account and transfer those amounts monthly to his checking to make the cash flow work the same.