Roth conversions for someone with an inherited IRA
Q. Client has zero funds in IRAs but has $100,000 in an inherited IRA. Also has very large 401(k) plan. His high income precludes him from benefiting from a deductible IRA. Any issue at all with him contributing on a non-deductible basis to an IRA and immediately converting to a Roth IRA – am I correct that the inherited IRA does not enter into the picture at all? Thanks!
Permalink Submitted by mk foss on Mon, 2014-02-10 17:36
Corret. The inherited IRA is not considered when looking at the tax on a Roth conversion. He should be sure not to take a 401(k) distribution in the same calendar year as the conversion but otherwise everything should work out well.