Roth Conversion. Split or not?
Does filing by 4/18/2011 with the election to split the 2010 Roth conversion tax prevent you from later filing an amendment to go ahead an pay it in 1 year?
Example, client doesn’t think they will do additional Roth conversions and later in the year decide to go ahead an doit again in 2011.
Permalink Submitted by Alan Spross on Wed, 2011-04-06 19:09
The election how to pay for 2010 Roth conversions is not irrevocable until 10/17/2011. Therefore, a return can be amended pror to 10/17 to change the election made when the first return was filed.
Client may also want to reduce the 2010 conversion by recharacterizing some of it if he is going to report all the income in 2010, and then do additional conversions in 2011 and beyond. The deadline for that is also the extended due date of 10/17. If client wants to do recharacterize, he should take note of the investment experience on the 2010 conversion, because if there are nice gains on that conversion, sending them back to a TIRA will make them eventually taxable.