Roth Conversion
Client has 100,000.00 coverted to ROTH in 2010, Can we report 20000.00 on the 2010 retur and then 40,000.00 for each 2011 and 2012. 😕
Client has 100,000.00 coverted to ROTH in 2010, Can we report 20000.00 on the 2010 retur and then 40,000.00 for each 2011 and 2012. 😕
Permalink Submitted by Alan Spross on Wed, 2011-03-09 20:08
No. Client’s options are limited to:
1) 50% in both 2011 and 2012, which is the default method
2) 100% in 2010 by opting out of the default method on Form 8606.
If for some reason, the client wanted the exact result you posted, that could be arranged by:
1) Recharacterizing 80% of his conversion, leaving 20,000 and then opting out and reporting the 20,000 in 2010. Probably not a good idea if he has gains.
2) Doing a reconversion after the 30 day waiting period after recharacterization of 40.000 in 2011
3) New conversion of another 40,000 in 2012.
If client did more than one conversion, the same choice must be made for all of them with respect to which year the income would be reported.