2010 Roth conv taxes – combination of options?
I understand that a 2010 converter can choose to split the taxable income between 2011 and 2012 OR pay it all in 2010. Does anyone know if they can do some of both? For example, if they convert $90k in 2010, could they choose to report $30 in 2010 and then split the $60k remainder between 2011 and 2012?
Thanks!
Permalink Submitted by mk foss on Fri, 2009-11-13 18:52
Unfortunately it doesn’t work that way. The default is to report one-half in 2011 and one-half in 2012. The taxpayer can elect to pay all of the tax in 2010. The only out is if both spouses are doing conversions – one spouse can report all in 2010 while the other is reporting half in each of the subsequent years.
Permalink Submitted by Thomas Alberg on Fri, 2009-11-13 20:21
Thanks for your reply Mary!
I assume that if a single taxpayer does 2 separate conversions in the same year, the result is the same – meaning that they couldn’t tax one conversion in 2010 and the other in subsequent years. Is that correct?
I guess it makes sense that spouses would have their own choice since the conversions are reported individually by spouse on separate forms 8606.
Permalink Submitted by Alan Spross on Fri, 2009-11-13 20:24
Right. All conversions done by a taxpayer in 2010 must be treated alike with respect to the two year deferral. As stated, a spouse can make a different election on their particular conversions than the other spouse.