Roth Recharacterization Rules
We had a client that made a Roth IRA contribution for 2012 on 2/11/2013. On 4/8/2013, he called to inform us he made too much money to make a Roth Contribution so we recharacterize the contribution into a non-deductible Traditional IRA. We want to reconvert the non-deductible Traditional IRA to a Roth IRA but I am unclear of how long we have to wait until we can do that.
Permalink Submitted by Alan - IRA critic on Fri, 2013-07-12 00:47
There is no waiting requirement because this is NOT a reconversion of a recharacterized conversion. It is a conversion of a recharacterized regular Roth contribution and there is no waiting period for that.
Permalink Submitted by Shane Larson on Fri, 2013-07-12 21:54
Alan,Thank you for the quick response. Could you please reference where this is indicated in the tax code?
Permalink Submitted by Alan - IRA critic on Fri, 2013-07-12 22:29
IRS Regs, see Q &A 9 in the attached. Note that the waiting period only applies to a conversion: http://www.taxalmanac.org/index.php/Treasury_Regulations,_Subchapter_A,_Sec._1.408A-5