Roth Conversion
Is it possible to make a non deductible IRA contribution and then convert it to an existing Roth, and do this annually? (not eligible for a Roth IRA or deductible IRA contribution due to current 401K and income limitations). Thank you.
Permalink Submitted by Alan Spross on Tue, 2012-03-20 19:15
Yes, you can do this annually.
But note that if you have any other pre tax IRA balances such as a rollover IRA, the conversion will be mostly taxable using the pro rate rules per Form 8606.
If this is your only TIRA account, the conversion will be tax free if you convert before any earnings are generated on your contribution.
Permalink Submitted by Michael Klonsky on Wed, 2012-03-21 13:21
Seems as if it’s a game for those who can’t make a Roth contribution initially.