iRD DEDUCTION
Can a IRD deduction from an inherited regular IRA be taken against taxes due on a subsequent conversion to a roth IRA ?
Can a IRD deduction from an inherited regular IRA be taken against taxes due on a subsequent conversion to a roth IRA ?
Permalink Submitted by mk foss on Tue, 2009-07-07 16:30
The IRD deduction is an itemized deduction that goes against income in general. It wouldn’t specifically offset income from a Roth conversion but it would reduce overall tax. This is the general rule.
If more specifically you wanted to know if the IRD deduction would be triggered by the Roth conversion, the question is more difficult. The IRD deduction is claimed as income is reported from an inherited IRA. An inherited IRA cannot be converted to a Roth IRA.
Presumably a surviving spouse could roll over an inherited IRA and convert it to Roth = but normally there is no tax on assets transferred to the surviving spouse so there may not be an IRD deduction available.