ROTH – Propagate 5 year age of existing acct into New Roth Conversion?
I have a small ROTH IRA which is over 5 years old.
It is isolated at custodian “A”.
I have Traditional and Rollover IRA’s at custodians “B” and “C”.
These are much larger than the “A” account.
I am 65, married, and not employed.
Is there a pathway I can use, to somehow propagate the 5 year age of
the existing ROTH at “A”, into proposed ROTH conversions at “B” and “C”,
so that I would not need to start a new 5 year clock?
I would be happy to start by transferring the “A” Roth into custodian “B” or “C”
and reinvest the money, if that would help to start the process.
Thank you!
Permalink Submitted by Alan - IRA critic on Fri, 2013-04-26 16:52
You do not have to restart the process. Since you are over 59.5 and have held your first Roth IRA at least 5 years, all your Roths, past or future are fully qualified and tax free. You can convert your TIRAs to a Roth and they are instantly qualified. The 5 year holding period you may have read about for Roth conversions relates to an early withdrawal penalty, but that ended at 59.5 like any other early withdrawal penalty. You could convert and withdraw that conversion money and it’s earnings at anytime without tax or penalty.