Roth conversion withdraw
Has anything changed in the tax law regarding Roth IRA conversion under 59.5 withdraws? Are distributions of converted funds not held for five years still subject to the 10% penalty, even if the Roth account has been in place for more than five years?
Permalink Submitted by Alan - IRA critic on Mon, 2024-05-20 20:26
Yes, no change there.
Of course, conversions come out in chronological order of the conversions and only after all regular contribution balances have been distributed.
If the conversion was only partly taxable, the penalty only applies to the taxable portion of the conversion. There may also be other penalty exceptions that apply in addition to being 59.5.