Roth Conversion & 59 1/2
Can a person under 59 1/2 convert to A Roth IRA without incurring excise tax if they do not withdrawal any money from their Ira to pay the conversion tax, but instead convert and pay the tax from a non-qualified source? Thank you in advance.
Permalink Submitted by Alan Spross on Sun, 2011-08-07 03:17
Yes.
It is generally recommended to NOT withhold from the TIRA distribution that funds the Roth conversion. This is one of the reasons, another is that the amount withheld is lost to either type of IRA.
If someone has withholding taken from the TIRA distribution, they can still replace the withholding by rolling the amount withheld into the Roth IRA within 60 days of the original distribution.