Back-door Roth while owning Inhertied IRA

Submitted by Nick Pappas on Fri, 2015-01-23 21:34

Is an Inherited IRA included in the “IRA Universe” when determining a non-deductible contribution to an IRA that you wish to convert to Roth?

Normally I would roll all IRAs into 401k/403b to eliminate this problem but this time its not an option. I just need to know I can execute this plan or if the Inherited IRA will be part of the calculation and then cause some taxation.

Hopefully my question makes sense.

Thanks in advance as always,
Nick



Submitted by Alan - IRA critic on Fri, 2015-01-23 22:17

Hello Nick.  Inherited IRAs are not included on 8606 line 6 for owned IRAs. If the inherited IRA has basis, it will have it’s own separate basis and it’s own 8606 to determine taxable amount of distributions. Of course, inherited IRAs cannot be converted – yet.



Add new comment

Log in or register to post comments