5 year holding period on IRA to Roth rollover
Just saw an article in BottomLine Personal from July 15, 2010 where Ed says that’ the Roth must stay there for 5 years…but that isn’t always the case’!
Can you clarify?
Ralph
Just saw an article in BottomLine Personal from July 15, 2010 where Ed says that’ the Roth must stay there for 5 years…but that isn’t always the case’!
Can you clarify?
Ralph
Permalink Submitted by Alan Spross on Fri, 2012-03-02 20:20
Yes, there have not been any changes for Roth IRA holding periods since they were introduced in 1998.
5 years from the year of the first Roth contribution is still one of the requirements for the Roth to become qualified.
And conversions must be held 5 years for each year’s conversions to avoid the 10% penalty if those conversions are distributed. This ends at age 59.5
All Roth accounts are considered to be combined into one account for tax purposes, and any of these accounts can be transferred to a different custodian anytime.