Roth conversion of multifamily syndication holding in Traditional SDIRA
If I have a traditional SDIRA with an apartment syndication holding that is making monthly distributions, can I do a Roth conversion of that holding? I am 71, but not taking the distributions..they are going back to the SDIRA custodian(non-interest earning account) and I periodically transfer them from the SDIRA custodian to a small balance Schwab IRA that is in a MM fund. My wish is to completely convert my traditional to Roth in 2024, but haven’t found the answer yet about syndications. I’ve been in the deal less than a year, $75k investment, so assume I could use $75k as FMV, but can I do the conversion, and could distributions go to the Roth?
Permalink Submitted by Alan - IRA critic on Tue, 2023-12-26 17:13
You would have to check with the SD IRA custodian, if you can open a Roth IRA with them and have the holding transferred to the Roth IRA as a conversion, with the monthly distributions continuing to be made to the Roth IRA. The custodian will issue a 1099R showing their calculated value on the date of the conversion. Obviously, if you have a TIRA balance in 2 years when RMDs must begin, it would be simpler if this investment was in your Roth before your first RMD year.