I am aware the SIMPLE requires a 2 year wait from the initial contribution before rolling into an IRA for conversion. Other than this restriction, can SEP-IRAs and/or SIMPLE IRAs be converted directly to a Roth or do they need to be rolled over to an traditional IRA first?
Can a portion of an “active” Simple IRA be converted to a Roth after the two year period has been met. Or must you wait until you no longer work for the sponsoring employer?
After the 2 year waiting period, partial or full TIRA rollovers or Roth IRA conversions can be done at will. Regular taxable distributions can also be done, but the early withdrawal penalty is 25% instead of the usual 10%.
Permalink Submitted by Alan Spross on Mon, 2010-03-29 21:23
They can be converted directly to a Roth IRA. Form 8606 is used to report such IRA conversions.